Crain's Grand Rapids Business, November 25, 2024

WOLVERINE STEPS INTO TURNAROUND

By Mark Sanchez

When Chris Hufnagel took over as CEO in August 2023, Wolverine World Wide Inc. was what he calls a “burning platform.”

Sales were declining, debt was far too high,inventory had ballooned, key brands were con-

tracting at double-digit rates, and “we had a cost structure that didn’t match the size of the business,” Hufnagel said.

Today, more than a year into an ongoing turnaround plan that was put in place soon after Hufnagel’s elevation to the role of president and CEO, the Rockford-based footwear and appar-

el marketer sits in far better shape. e company has cut debt nearly in half and reduced inventories signi cantly. Sales for two key brands, Merrell shoes and Sweaty Betty activewear, returned to growth in the third quarter. Wolverine also recorded

Grand Haven cruise boat is on deck

CEO hopes outings will become a staple attraction in local tourism

By Mark Sanchez

Visitors to the lakeshore next summer will have the opportunity to sit back and enjoy a two-hour tour of the waterways around Grand Haven.

BigBlueGH LLC plans to launch in May 2025, o ering two-hour tours, including sunset cruises, and longer private charters on the Grand River, Spring Lake and Lake

Michigan aboard a 48-foot steel vessel named Big Blue that can accommodate up to 55 passengers.

Erik Peterson, a longtime boater and the founder and CEO of BigBlueGH, hopes the cruises will become a staple attraction in the local tourism trade and gain popularity among the thousands of visitors who go to Grand Haven each year.

“I see this as becoming a really

iconic part of Grand Haven,” said Peterson, a mechanical engineer and avid boater who last year helmed the Flying Dutchman tour boat in Saugatuck.

“I see this thing as tting in like a glove with this town,” he said of Grand Haven.

e Grand Haven City Council earlier this month approved a

Detroit rm eyes former UICA building for coworking space

Plans also call for anchor tenant to manage business incubator for entrepreneurs

By Kate Carlson

Detroit-based coworking rm

Bamboo plans to purchase and redevelop the former Urban Institute for Contemporary Arts (UICA) building in downtown Grand Rapids with a phased opening in June 2025.

Doing business as 2 Fulton Street W LLC, Bamboo co-founders Mike Ferlito and Amanda Lewan seek to convert the former gallery and movie theater space into a coworking building. Renovations would include creating 45 private o ces that seat one to 10 people, eight high-tech conference rooms, a 2,600-squarefoot mezzanine for event space and a 4,000-square-foot outdoor patio that could be rented out for events.

Plans also call for a 3,400-squarefoot private suite for a permanent anchor tenant to manage a business incubator that supports entrepreneurs.

Bamboo started looking at expanding in Grand Rapids over a year ago, Lewan, Bamboo’s CEO, told Crain’s Grand Rapids Business.

“ is is a very important building in the community and has been sitting empty for several years,” Lewan said. “Every person I talk to in Grand Rapids knows this building and wants to see that corner activated again.” People would be able to work out of the Bamboo o ce space on a drop-in basis, or by longer term memberships, Lewan said. ey also plan to host some free and open events for the public. “ is is exible o ces and coworking,” Lewan said. “It’s really ideal for companies that aren’t

Chris Hufnagel discusses how Wolverine World Wide was able to turn around a distressed company “to become great builders of brands” and nd new opportunities for growth. | SETH THOMPSON

Detroit-based rm Bamboo is in the process of acquiring the former UICA building for coworking space.

Erik Peterson is working to repaint and refurbish the 48-foot, newly renamed vessel Big Blue, which he plans to use to offer water tours of the Grand Haven area starting in 2025. MARK SANCHEZ

Ottawa Impact denies incentives for housing project

Political faction disrupts $51m project by taking stand against tax breaks

By Rachel Watson

The largest-ever investment in multifamily housing in the Ottawa County city of Coopersville has been at least temporarily derailed by members of the far-right political faction Ottawa Impact who opposed tax incentives for the project on ideological grounds.

Pete Oleszczuk, president of Grand Haven-based Westwind Construction, said Nov. 13 his firm is “evaluating our options” after the Ottawa Impact-dominated

county Finance & Administration Committee voted 3-1 on Nov. 8 to reject a housing brownfield plan for his project. The proposed $51 million, 216-unit Meridian 43 workforce housing project is planned for 20 acres of former farmland at 49 S. 64th Ave. in Coopersville, just north of I-96.

The city of Coopersville and the Ottawa County Brownfield Redevelopment Authority had previously recommended the county commission approve the incentives plan.

“We’re still at a level of surprise, considering having the brownfield authority at the county level approve the entire plan and having it check all the boxes to get to that step, then having it be rejected with no real cause, all things considered,” Oleszczuk said. “... We’re still evaluating our options.”

The incentives, recently made available under the state’s expanded brownfield program to stimulate housing development, would

Meijer finds growth with small-format grocery stores

By Abby Poirier

Walker-based supercenter retailer Meijer Inc. is anticipating growth “on the horizon” for its smaller format stores, but is still weighing whether to return to 24hour operations.

That’s according to Meijer CEO and President Rick Keyes, who spoke with Crain’s Grand Rapids Business following a community event on Nov. 13.

Last year, Meijer launched the Meijer Grocery format in southeast Michigan, opening two stores in Orion Township and Macomb

Township. The new concept offers a condensed shopping layout with a smaller footprint, ranging from 75,000-90,000 square feet compared with the supercenter layout, which can be up to 150,000 square feet.

While the smaller format stores can offer customers a quicker shopping experience, the company also is positioning Meijer Grocery to fill in gaps in major metro markets where the retailer wouldn’t be able to put a larger supercenter, Keyes said.

Meijer Grocery stores include produce and grocery, a meat counter, bakery, deli, pharmacy,

“West Michigan is an important market for us, and we believe our customers deserve a great place to shop.”

Rick Keyes, Meijer CEO and President

health and beauty care, baby, pets and consumables, and greeting card, party and floral items.

This year, the company opened its third Meijer Grocery format store, located in Indiana, on July 11.

Going forward, the retailer will continue to focus on diversifying its portfolio, leaning on its smaller format stores like Meijer Grocery and neighborhood markets like Grand Rapids’ Bridge Street Market and Capital City Market in Lansing.

“Growth (is) on the horizon for all of those,” Keyes said.

As well, delivery and pick-up have remained “a huge growth story” for Meijer post-pandemic, he said.

“I think people really appreciate the opportunity to come into a store, pick up their order and just put it in their trunk and off they go

Independent Bank buys downtown building from DeVos family for $2.3M

Ceo expects ‘a good chunk of our team’ to move there within six months

By Mark Sanchez

Independent Bank Corp. has purchased a downtown office building from the DeVos family and plans to relocate its commercial banking staff, a retail branch and some C-suite executives to the heart of downtown.

The Grand Rapids-based Independent Bank bought the four-story, 15,136-square-foot office building at 98 Ottawa Ave. from RDV Corp. for $2.3 million, according to city property records. The sale for the building at the intersection of Ottawa Avenue and Fountain Street closed Oct. 11, Independent Bank President and CEO Brad Kessel told Crain’s Grand Rapids Business.

Kessel expects “a good chunk of our team” to move in within six months after the completion of a remodeling project. The bank’s commercial banking staff and the retail branch, now housed in leased space nearby on Monroe

Center, will relocate to the building. Kessel, CFO Gavin Mohr and perhaps other executives also intend to have an office at the Ottawa Avenue location.

Independent Bank also plans to house private bankers and mortgage loan officers at the site. Through the move, Independent Bank will double its downtown square footage and presence from about 20 to 40 people.

The location will give Independent Bank greater visibility in downtown and “help us to leverage a lot of the momentum that we have going right now,” Kessel said.

“Independent Bank is one of the largest banks headquartered in Michigan and we just want to put a stake in the ground and have a greater presence there,” he told Crain’s Grand Rapids Business.

“There’s so much momentum in downtown on both sides of the river that is taking place. We

The 216-unit Meridian 43 workforce housing project is planned for 20 acres of former farmland at 49 S. 64th Ave. in Coopersville, just north of I-96. oPPeNHUIZeN ArCHITeCTS

Meijer has found growth with its smaller format Meijer Grocery stores, which typically span 75,000-90,000 square feet. | CoUrTeSY PHoTo

LARGEST MINORITY-OWNED BUSINESSES IN WEST MICHIGAN

ResearchedbyDanielleNelsonandSonyaHill|ThislistisanapproximatecompilationofthelargestsuchbusinessesbasedinKent,Ottawa,Kalamazoo,MuskegonandAllegancounties.Itisnota completelisting,butthemostcomprehensiveavailable.Unlessotherwisenoted,thecompaniesprovidedtheinformation.Rankingnumbersareduplicatedinthecaseofatieandarebasedonfullrevenue. Therankingnumberswillnotbeduplicatediftherevenueisnotanexactmatchofthefullrevenuebeforerounding.N/A=notavailable. e. Crain'sestimate. 1. WaséyabekDevelopmentCo.LLCisthe non-gaminginvestmentarmoftheNottawaseppiHuronBandofthePotawatomi,afederallyrecognizedAmericanIndiantribe.Waséyabekfunctionsasaholdingcompanythatincludesthreedivisions: commercialoperatingbusinesses,realestateholdingsandafederalcontractingunit. 2. The10companiesandeightpiecesofrealestatemajorityownedbyWaséyabekinclude:BakerEngineering, BLDI,RSIManufacturing,DWHLLC,SafariCircuits,VES,andFED95,amongothers.Waséyabekalsois50%owneroftheMcKayTowermixed-usedbuildingindowntownGrandRapidsandofZip XpressInc.andGreenTransportation,allofwhicharejointlyownedwithGunLakeInvestments,thenon-gaminginvestmentarmoftheMatch-E-Be-Nash-She-WishBandofPottawatomiIndians. 3. From PlasticsNews 4. CorrPakisaprivatelyheldcompany.Itsrevenuerangesfrom$8millionto$15million. 5. PartofBodweProfessionalServicesGroupandwhollyownedbyMno-Bmadsen,theinvestment enterprise and a wholly-owned instrumentality of the Pokagon Band of Potawatomi. 6. Previously Hire For Hope.

Survey finds region’s industrial economy picked up in October

By Mark Sanchez

West Michigan’s industrial economy showed signs of improvement in October, as key metrics reversed slides of recent months.

While three of the four key metrics in economist Brian Long’s monthly report remained negative, each recorded solid month-tomonth improvements after four months of declines.

“Although one month does not constitute a trend, we can hope that the latent fear of a recession may be subsiding, inflation may be stabilizing, and the widely anticipated soft landing may still be possible,” Long, director of supply chain management research at Grand Valley State University’s Seidman College of Business, wrote in his November report on the results of his monthly survey with West Michigan industrial purchasing managers. “However, we have not ‘landed’ until inflation convincingly returns to the Federal Reserve’s target of 2%, and we simply

“Overall,

we are on track to finish 2024 on a positive

note.”

Brian Long, economist

aren’t there yet.”

Still, Long concluded: “Overall, we are on track to finish 2024 on a positive note.”

In the report that Long issued Nov. 11, the index for new orders improved 21 points from September to October to a negative 2, and the production index improved to a negative 9 from a negative 28.

The index for purchases improved 15 points to a negative 16, and the employment index registered a positive 3, a 14-point improvement from the prior month.

The employment index returning to positive territory “implies that the industrial employment situation in West Michigan is now reasonably stable,” Long said.

The short-term outlook for the next three to five months and the long-term outlook among executives answering the survey both improved as well.

Now that the U.S. presidential election is over, with Donald Trump scoring a decisive victory, Long believes that the national economy could further improve.

“Business planners don’t like uncertainty, so the biggest positive effect of the election finally being over is that we now have some kind of an idea of what the regulatory and tax environment may look like going forward. This could actually boost economic activity as we go into 2025,” he wrote.

Part of what’s been occurring in West Michigan’s industrial sector has been “destocking,” as manufacturers reduced production volumes for durable goods that had been elevated during and coming out of the pandemic, according to Randy Thelen, president and CEO of The Right Place Inc.

“In the heart of the pandemic, when the supply chain was absolutely disrupted and broken, virtu-

ally every company bought what they could buy. Their supply chain went from ‘just in time’ to ‘just in case,’ and if they found an opportunity with a supplier to get some product, they bought it and stacked it up in their warehouse,” Thelen said during a presentation at this month’s Crain’s Grand Rapids Business Power Breakfast on commercial real estate.

“If you went through factories over the last couple of years, you saw more inventory on the floors than ever before. In certainly my 30year career in economic development, I’ve seen more inventory on

manufacturing floors in the last few years than ever before,” Thelen said. “Well, now that the supply chain is normalizing, the companies that had been buying all the supplies are starting to de-stock, work down those inventories, and that means the current orders for their supply chain are going down, and we’re seeing that in our community. We’re definitely seeing a slowing in our manufacturing sector and that’s something for us to keep our eyes on and ears open for.”

The Right Place is scheduled to issue its annual economic outlook for West Michigan on Dec. 5.

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The employment index returning to positive territory implies stability, according to Brian Long’s monthly report on the area’s industrial economy. | UNSPLASH

Visas for skilled employees may take longer under Trump

By Elizabeth Schanz

Employers should brace for potentially higher costs and longer waiting periods when seeking work visas for skilled international employees as President-elect Donald Trump prepares to take office for a second term, legal experts say. If the heightened bureaucratic barriers during Trump’s first term are any indication, employers could face a resurgence of restrictions on H-1B visas, the primary visa needed for skilled foreign workers with at least a bachelor’s degree obtained in the U.S. “The bottom line is that there will be increased scrutiny on foreign workers and the businesses that want to employ them,” said Daniel Persinger, senior counsel at Warner Norcross + Judd LLP who works with businesses navigating visa regulations. “That will probably result in increased processing times, possibly increased costs and probably more uncertainty for businesses who utilize international labor.”

Because of a lack of major legislative changes by Congress to immigration policy over nearly four decades, the implementation of immigration laws can shift through executive orders or from the Department of Homeland Security and immigration agencies.

The H-1B program has a cap on the number of visas it grants annually: 65,000 “regular” visas and 20,000 visas for workers with a U.S. master’s degree or higher.

Historically, both Democratic and Republican administrations

had greater deference to employers seeking H-1B visas, and U.S. Citizenship and Immigration Services would often accommodate needs and requests for international labor, Persinger said.

This was not the case from 2017 to through 2020, when H-1B denial rates spiked.

From fiscal year 2010 to fiscal year 2015, denial rates on H-1B petitions hovered in the single digits, with a 6% denial rate in FY 2015.

Under Trump, the denial rates increased into double digits, peaking at 24% in FY 2018 and dropping slightly to 21% in FY 2019. The denial rate drastically fell to 4% in FY 2021 and 2.2% in FY 2022 under the Biden administration.

In 2020, a federal judge halted the Trump administration’s effort

earlier that year to suspend the entry of foreign nationals under the H-1B and other programs. Groups challenging Trump’s 2020 proclamation included the National Association of Manufacturers, the U.S. Chamber of Commerce and the National Retail Federation.

A new clampdown on the H-1B program could affect hundreds of employers in Michigan, where Ford Motor Co., the University of Michigan and General Motors Co. were most recently among the top five beneficiaries of the program based on the number of visas approved, according to U.S. Citizenship and Immigration Services data.

A total of 1,540 employers in Michigan submitted H-1B visa petitions with 11,690 visa applica-

tions during the 2024 fiscal year that ended Sept. 30, according to USCIS.

The Michigan employers with the most H-1B visa approvals in FY 2024 are Ford, Troy-headquartered Atos Syntel Inc, U of M, GM and Troy-based HTC Global Services Inc. The top West Michigan employers using the H-1B program last year were Dematic Corp., Whirlpool Corp., Meijer Great Lakes Limited Partnership, Corewell Health and Grand Valley State University.

“The H-1B visa is an important pipeline for health care as the industry faces domestic workforce shortages in critical areas,” Corewell Health said in an emailed statement to Crain’s. “We support a robust visa process that helps protect and keep Americans healthy.”

Also in Grand Rapids, the Van Andel Institute obtained 24 H-1B visas in FY 2023 and 20 in FY 2024.

The nonprofit research foundation has employees from more than 30 countries, according to its website.

filed, the USCIS can either approve the request, deny it, or ask for more information, which was often the USCIS’ response during the first Trump administration, Persinger said. Requests for additional information create both money and time barriers for employers.

When the USCIS issues “multiple repeated requests” for evidence, employers take on added legal costs to respond to the requests.

Legal fees for a typical H-1B are about $3,000, assuming that the USCIS approves it with no difficulty. If the USCIS comes back with additional requests, the cost could easily double to $6,000, or more, Persinger said.

Additionally, companies could take on internal costs when human resources departments spend more time gathering information about the job, workforce, market environment, wages and more, he said.

“In my specific line of work, especially here in West Michigan, we are talking about the smaller employers. …They have less ability to absorb these costs,” Persinger said. “There’s absolutely economies of scale that can be achieved if you’re accessing foreign labor and my clients, generally speaking, are very cost-conscious. They desperately need talent, but they don’t have the massive legal and HR budgets.”

Delays during the visa petition process can also be time consuming for employers and international employees.

Typically, it takes six months to receive a response from USCIS about the status of an H-1B petition, Persinger said. A USCIS request for more information could take another four weeks.

“Van Andel Institute closely follows current immigration policy in our recruiting and hiring practices,” the organization said in an emailed response to Crain’s Grand Rapids Business. “We will monitor any proposed changes and adapt as necessary if they are implemented.”

The Van Andel Institute added that it will “continue to advocate for policies that enable the best minds from around the world to contribute to our mission” and “as a biomedical research institute, we support immigration policies that permit international talent to join us in our fight against cancer and neurodegenerative diseases.”

Trump-era policies imposed additional burdens on employers looking to employ skilled international workers as a result of the “Buy American, Hire American” executive order that was issued in 2017. The order led USCIS to increase Requests for Evidence on H-1B visas, L-1 intracompany transferee visas and J-1 exchange visitor visa applications. The order also resulted in greater scrutiny of job descriptions, wage levels and employer-employee relationships.

Under these policies, employers struggled to get petitions for H-1B visas approved. When a petition is

This additional burden of evidence can delay the potential start date for the person seeking a visa or cause them to have to leave the country because it takes “so long to adjudicate the case” and lose status during the process, Persinger said.

“Time is money, and these delays create additional costs, where employers are going to have to either find other workarounds or go elsewhere for this kind of talent,” said Andy Johnston, senior vice president of strategic engagement for the Grand Rapids Area Chamber of Commerce. “When things drag on for months and months, that just doesn’t work for businesses who need to meet the demands of customers and clients sooner rather than later.”

While it remains to be seen whether Trump’s previous H-1B restrictions will return, attorneys are encouraging H-1B employers to review their current workforce to be aware of visa renewals, prepare to build additional costs into budgets and brace for longer lead times to maintain international talent.

“I would hate to see our West Michigan businesses that are smaller, but truly international, disadvantaged in accessing talent that they need,” Persinger said.

Crain’s Grand Rapids Business reporter Rachel Watson contributed to this story.

A U.S. Citizenship and Immigration Services waiting room in New Jersey. CoURTESY oF USCIS

Kalamazoo State Theatre closes as owners seek buyer

By Abby Poirier

The nearly 100-year-old Kalamazoo State Theatre closed on Nov. 24 and canceled all of its upcoming shows as the Hinman Co. seeks a new owner and operator for the historic venue.

Kalamazoo State Theatre Executive Director Stephanie Hinman said “a number of factors” play a part in the timing of the closure, including the theater’s upcoming 100th anniversary on July 14, 2027.

“There is never a good time for a decision like this but the decision is about protecting and preserving the Kalamazoo State Theatre,” Hinman said in an email. “By making the announcement and focusing on the theatre’s next iteration now, we hope to make plans and transitions in ample time for the next stewards to execute a grand and well-planned celebration.”

Portage-based Hinman Co. purchased the theater in 1985 for $300,000 and then renovated and reopened it. The developer and property management firm is looking for a nonprofit to continue to own and operate the venue.

Hinman noted that “most facilities nationwide similar to the theatre are community owned, either through a nonprofit, foundation, or municipality.”

“This may require establishing a new nonprofit with its own board of directors and staff or joining with an already established nonprofit,” she said.

The venue seats approximately 1,600 guests in a 12,876-squarefoot auditorium, with an additional 12,834 square feet of third-floor office space.

The Kalamazoo State Theatre hosts dozens of concerts, film screenings and other events annually, drawing more than 32,000 visitors a year.

Past performers at the State Theatre range from musical icons B.B. King, Louis Armstrong and Duke Ellington to pop stars Britney Spears, Ludacris and Chappel Roan.

“We bought the theatre in 1985 to protect it from being torn down and forgotten,” Roger Hinman, CEO of the Hinman Co., said in a statement. “Our goal is to identify and entrust a like-minded organization with caring for and loving the Kalamazoo State Theatre as we have for the past 40 years.

“By pursuing a transition in ownership now, we are providing an opportunity for the theatre’s next steward to take shape, sustain this unique and irreplaceable destination, and, hopefully, celebrate its 100th anniversary in 2027.”

The Kalamazoo State Theatre, lo-

cated at 404 S. Burdick St. in downtown Kalamazoo, closed following a performance by Almost Queen and special guest Lisa Can’t Sing on Nov. 24.

According to the Hinman Co., the closure is intended to be temporary, and will be used to “gather interest and identify a new organization” to take over the venue.

The theater, designed by John Eberson, opened in July 1927. According to a report from the Kalamazoo Public Library, the State Theatre was part of a chain of 114 Butterfield vaudeville and cinema theaters operated across Michigan

by W.S. Butterfield Theatres Inc., four of which were located in Muskegon.

Stephanie Hinman will oversee the search for a new owner and operator for the theater.

“This venue is more than just a building and a business. It is a historic community asset, a recognized treasure, and a huge responsibility. Ensuring we find the right people and group to move the Kalamazoo State Theatre forward with the vision to preserve and keep it alive through continued use is a top priority and focus,” she said. “This place matters. We love this

place. We want what is best for not only the building but the community as well.”

In addition to Hinman, the theater has five full-time employees, who will be provided severance packages after the theater closes.

The Kalamazoo State Theatre had seven upcoming performances scheduled, including a Queen tribute, an Abba tribute and a performance by comedian and Impractical Jokers star Joe Gatto. Tickets for all shows following Nov. 23 will be refunded at the point of purchase or at the box office, which will remain open through Dec. 5.

Hinman Co. is closing Kalamazoo State Theatre to search for a new owner/operator of the historic downtown venue.

| CoUrTeSY PHoTo

CAN ANYTHING STOP HACKERS AND CYBERATTACKS?

With ransomware and other increasingly sophisticated cybercrimes on the rise, unprepared businesses can face high costs, compromised data and crippling downtime

By Dustin Walsh

The Russell Industrial Center, the heart of Detroit’s booming automotive industry a century ago and mere steps from General Motors’ Hamtramck Assembly plant, hardly seems a likely target for cybercrime backed by a nation-state.

But in the fall of 2018, new world in, old world out, direct-mail agency Wolverine Solutions Group fell victim to an advanced ransomware attack on its network that crippled the company for weeks and compromised the equivalent of 4.2 billion pages of customer data — an attack that ultimately cost Wolverine nearly 15% of its annual revenue to recover.

“At the time, we felt very prepared,” said Darryl English, president of Wolverine. “We had an extremely quali ed technical team and we had invested in the best security for the network, in terms of rewalls, antivirus and everything you’re told you should have. We were doing all the right things. But nothing prepared us for this.”

Wolverine was an early victim to the rise of ransomware — when cybercriminals hack into a network, encrypt the data and demand a ransom to get it returned or threaten the release of private customer information across the dark web — spiderwebbing across the nation.

e statistics are staggering: ransomware attacks grew by 73% in 2023 to more than 4,600 successful breaches; the average ransom demand in 2024 is $5.2 million; 65% of all nancial institutions have reported a ransomware attack this year; the average cost to recover data encrypted in the attack is $2.73 million; the average downtime for a company’s network after an attack is 24 days.

And ransomware is just one of many increasingly sophisticated cyberattacks today’s companies face.

What can be done to stop them? State legislators are now weighing in with a package of bills in Lansing that would de ne how businesses respond to an attack, including the timing of notifying consumers of an attack, third-party vendor noti cations, authorizing

FORUM UNDERWRITER

investigative authority to the Michigan attorney general and procedures for safeguarding sensitive information.

But would that increased burden on businesses, which are victims of crimes most commonly committed by nation-state actors from the Iranian National Guard or Russia or North Korea, prevent or lessen the damage done by cyberattacks?

It’s complicated and, of course, controversial.

One company’s journey

English is a supporter of the proposed legislation; he testi ed in a Michigan Senate committee hearing saying as much late last month.

Wolverine, at the behest of noted cybersecurity attorney and Butzel Long partner Claudia Rast, did all the things the proposed bills would require — sent notices and o ered credit protection to 1 million consumers, 800,000 in Michigan; held two calls a day with each of its customers, including the state of

Annual compromises

Annual compromises

Total number of compromises and the number of victims affected from 2005-2023

Total number of compromises and the number of victims affected from 2005-2023

Compromises by industry

Compromises by industry

Industries affected by compromises in 2023

Industries affected by compromises in 2023

Source:

Michigan; and noti ed the AG’s o ce and FBI immediately.

“We were not required to notify the AG, but we did. We were not required to o er any consumer credit protection, but we did it,” English said. “Claudia said it was the right thing and it was. We did everything this bill is presenting.

We went to the extreme and did everything we could.”

English said the company was lucky it had a well-rounded response e ort, but it didn’t prevent the crime.

e hack, which occurred in September of 2018, started as minor hiccups in Wolverine’s systems

— computers getting those wretched blue screens, rendering them useless, systems shutting down randomly and without warning.

“Your initial reaction is to address those problems, and you don’t think it’s something bigger,” English said.

But by the third day of network

bugs, his team realized it was a security event when all of its more than 10 terabytes of data — the equivalent of 10 million high-quality photos or 19 years of downloaded music played continuously — and its controls were encrypted by the cybercriminals.

e demand, like most in the world of ransomware, was for hundreds of thousands of dollars in bitcoin — auto dealer software supplier CDK Global was targeted with ransomware in June when criminals demanded 387 bitcoin, equivalent to $25 million at the time, and the company reportedly paid.

Wolverine paid, too, though a much more modest sum for the $35 million company compared to the nearly $2 billion CDK.

“We did what we were advised,” English said. “To pay this amount with all of the questions we had — ‘Would they take the money and go away? Do you actually get the encryption keys or will they come back and ask for more?’ We were told there was honor amongst thieves. If they take our money and don’t give us the encryption keys, then the whole jig is up for them. So we rolled the dice and we paid. ey gave us the keys and sent us a thank you note.”

Secrecy and uncertainty

Companies pay. at’s why the ransomware is so prevalent. In 2023, victims paid out $1.1 billion in ransom to cybercriminals, according to New York bitcoin tracking rm Chainanalysis.

Change Healthcare, a subsidiary of insurance giant UnitedHealth, paid a $22 million ransom to Russian cybergang BlackCat after its ransomware attack disrupted millions of payments to health care providers for weeks in 2023.

But that honor English spoke about appears to have eroded in the last few years as Change never got its data back and hackers reportedly tried to extort the company a second time.

Sources close to the ransomware cyberattack on Ascension Health in May, which took down the 140-hospital system’s electronic medical records and caused doctors and nurses across Michigan to maintain handwritten records, told Crain’s the system didn’t pay the ransom and elected to rebuild its systems and restore the data it could.

Grand Blanc-based McLaren Health Care declined to con rm whether it paid a ransom in a attack similar to Ascension’s in August.

Source: Identity Theft Resource Center

Identity Theft Resource Center

In 2018 Wolverine Solutions Group fell victim to an advanced ransomware attack on its network that crippled the company for weeks. “We were doing all the right things. But nothing prepared us for this,” Darryl English, president of Wolverine, said. | NIC ANTAYA

CYBERSECURITY

Wolverine was ultimately at a business standstill for three weeks, English said.

“We were extremely transparent,” English said. “I was personally doing calls from 6 a.m. to midnight every day until we were up and running. I think we gained a lot of respect because a lot of companies get hit and never say anything because they don’t have to. At the very least, these bills present a guideline of the things you need to do. e right thing to do.”

What states can do

Governments, such as Michigan’s, are eager to prevent the loss of consumer data and prevent these attacks from occurring, but appear relatively hamstrung by the clandestine nature of the cybergang diaspora.

Michigan’s AG doesn’t have much authority to wrangle with faceless gangs operating out of co ee shops in Romania or arcades in China.

Instead, legislation targets the victims of the crimes, the companies themselves. It’s the only play the state government can make and one it hopes pushes all industries toward stronger defense systems and safeguarding capabilities.

Michigan Senate Bills 888-892, sponsored by Democratic Sen. Rosemary Bayer, expand the scope of Michigan’s Identity eft Protection Act by including biometric information as protected personal data and require all companies to notify consumers and the AG’s ofce if the data of 100 or more people has been breached.

“Like too many other Michiganders, I have been personally affected by data breaches in recent years, and I understand the worry, frustration, and headaches that come along with it. We can and must do better for our Michigan consumers,” Bayer said in a press release upon introducing the legislation early last month.

“ is legislation brings Michigan up to speed with 37 other states who require that entities notify the attorney general when data breaches occur, enabling them to get ahead of the issue and better support a ected consumers.”

Not everyone agrees

Despite English’s support, many across the business sector are opposed to the legislation.

Top compromises in 2023

In an Oct. 9 letter to the Senate Committee on Finance, Insurance, and Consumer Protection, the Michigan Chamber of Commerce, Detroit Regional Chamber, Michigan Retailers Association, Grands Rapids Chamber, Michigan Manufacturers Association, Small Business Association of Michigan and National Federation of Independent Business issued concerns about the package.

e coalition of business groups said in the letter that the legislation is too vague and creates overlapping mandates from di erent states and the federal government.

Also at issue is the requirement to provide 24 months of credit monitoring to a ected parties versus the industry standard of 12 months and the 100-consumer impacted threshold, instead of 250 to 500 in other states.

“We urge the committee to closely review the language of this bill and to work with the business associations included in this letter to nd a path to balance both the protection of Michigan’s customers and the ability of businesses to comply with this act while competing for growth in the state,” the letter reads.

e Michigan Bankers Association, which represents 99 banks in the state, also opposes the legislation.

“We do not want things that are going to be punitive or burdensome for businesses,” said Alex Morris, assistant vice president of advocacy for the Lansing-based group. “Consumer data should be protected and we support a baseline noti cation method, but in this space we are typically more supportive of a federal solution to avoid a patchwork from the states. All of these breaches are interstate or even have international pieces to them.”

Meanwhile, every September, English gathers Wolverine’s employees not for a celebration, but for an educational event on the day the company was ransomed. It’s a solemn reminder of the cost to the company’s bottom line and the diligence required to prevent another attack.

“( e attack) is not something we’re proud of, but part of the DNA of this company,” English said. “Something happened here and this threat is not going to go away. We can never feel 100% comfortable again and that’s why we keep reinvesting in infrastructure tools to make sure we are doing the very best that we can.”

steps companies should take after a data breach

You’ve been hacked. Now what?

Cybersecurity is now paramount in the operations of every business. While large hacks, such as the attack on UnitedHealth’s Change Health Care last year and Equifax in 2017, dominate the headlines, cybercrime against businesses is nearly ubiquitous. In fact, small businesses are the target of 43% of all cyberattacks annually. Yet, only 14% of small companies even have a cybersecurity plan. Even fewer have cybersecurity insurance.

The most common expression in the world of cybersecurity today is “not if, but when” will a cyberattack happen. While all efforts should be put on prevention, there’s also little guidance for companies on what to do if systems are breached.

This is a basic, somewhat rudimentary, guide for steps companies can take to address a cyberattack before, during and after the event, compiled from several reputable sources in the sector, including the U.S. Chamber of Commerce, IBM and federal agencies.

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Develop an incident response plan

While response plans are required in some industries and those with certain federal contracts, they are recommended for every company. An IRP is exactly what it sounds like — an outline of steps required to plan, respond to and recover from a cyberattack. The National Institute of Standards and Technology and private companies like the SANS Institute and Crowdstrike offer free, step-by-step frameworks for developing an IRP. Setting a framework of procedures can be the difference in discovering and addressing a breach and mitigating the damage as well as realizing immense cost savings.

Determine the type of attack

Once your systems have been breached, it’s of timely importance to determine what the attackers are or were after. Has data been stolen? If so, what data? What can they do with it? Ransomware attackers generally let the company know they are there, with demands for ransom to return control of the systems back to the victim. The response will be dictated by the type of attack. The U.S. Cybersecurity and Infrastructure Security Agency has a guide on how to handle ransomware.

Isolate affected systems, hardware

Among the most challenging aspects of a cyberattack is rooting out the bad guys, nding what systems are struck and removing those systems, computers, etc., from the larger connected network. Powering down hardware is not recommended because maintaining evidence is key to understanding the hack and vulnerabilities.

Go ‘old school’

Hackers may very well be monitoring IT communications and activity. So it’s important to immediately switch from email and chat app communications to in-person meetings. Allowing the culprits to know what you know could cause them to better cover their tracks or destroy valuable information or rapidly lock users out of the systems. 4

Preserve and restore

At this point, a third-party cybersecurity contractor should have been brought in if the attack is above the internal IT department’s skill level. But preserving logs, memory dumps, network traf c and more is critical to restoring the systems to full working status. Then the work of removing malicious code and software updates commences as well as resetting all passwords. If ransomware is involved, all the data may need to be decrypted, a laborious step. Once the systems are free from hackers, the systems’ les should be tested and then, once determined to be safe, the systems can be reconnected to the network. 5

Inform and communicate

The company’s legal team, internal or external, should have by now informed the proper authorities on the attack. Different states and federal agencies require noti cation following a cyberattack at various times depending on the type of attack and what data has been compromised. Customers and vendors should also be noti ed as soon as possible about the attack, especially if their data has been compromised. 6

STRENGTH IN PARTNERSHIP Happy Thanksgiving.

As we close another successful year, we’re grateful for the partnerships that have propelled us forward. Being part of the West Michigan community is truly a privilege, and each day, we’re inspired by the local businesses we collaborate with. To our clients and partners, thank you for trusting us with your goals and objectives. Together, we’ve accomplished so much , and we’re excited to see what the coming year holds. Here’s to future success - yours, ours and our community’s.

To pay or not to pay ransom, that is the question

When hit with a ransomware attack, the health care industry faces a dilemma: pay the ransom or try to restore the systems and data manually. This is a tricky and risky proposition.

Do we figure out a way to eliminate the threat and restore our system to a time when all was running well, or are we merely shrugging our collective shoulders and caving to those within the organization, considering what could happen to patients’ lives?

Doug Witten

is an assistant

professor in the department of computer science at Wayne State University.

The critical functionality of ransomware is that once the attacker gains privileged access, they embed the software deep into the system, making it extremely difficult to eradicate. The application will remove methods to recover the system and encrypt all pertinent systems and data files. The program will then send a message to the user with instructions on paying for their recovery.

This past April, Change Healthcare, a subsidiary of UnitedHealth Group, suffered a loss of $1.521 billion in direct data breach response costs due to a ransomware attack that caused its payment platform to suspend operations between doctors, pharmacies and testing facilities. This affected nearly one out of every three Americans. The theft centered around billing records, personal data and insurance data.

Also, this past April, Octapharma Plasma, a company that produces blood plasma products in America and supplies almost 75% of European countries, was hit with a ransomware attack that shut down over 150 collection centers, resulting in critical shortages in Europe.

In an interesting case study from August 2023 in Las Vegas,

CEOs need to act today to outsmart adversaries with AI

Cyber adversaries — the bad guys — are leveraging AI to infiltrate IT environments and compromise data on an unprecedented scale.

As a leader who runs an IT and cybersecurity organization, I’ve witnessed firsthand how rapidly the threat landscape is evolving. While some executives take this seriously, many CEOs remain on the sidelines, not fully embracing their responsibility to safeguard their technology and customers. Leaving this to IT departments without strategic oversight or appropriate budgets exposes organizations to an increasingly hostile digital world. Without AI-powered cybersecurity solutions and full CEO support, businesses are bringing a knife to a gunfight.

liseconds. It’s crucial to fight fire with fire.

In practice, this is challenging.

ransomware hit Caesar’s Palace and MGM Grand casinos. Caesar’s Palace opted to pay the $15 million ransom, while MGM decided to try to fix the problem themselves. MGM’s decision cost them dearly, with an outage lasting 10 days and costing them over $100 million.

Companies face the decision of whether to pay; some do, some don’t. The consequences are enormous either way.

A hacking organization called Blacksuit, formerly Royal Ransomware, is responsible for all the ransomware listed here. It hires contractors to help facilitate these large fraud schemes and operates as a ransomware-as-a-service business. The group brings in hackers from all over the world to assist with various aspects of an attack. An interesting aspect is that this organization failed to pay many of those cybercriminals, reminding us of the adage that there is no honor among thieves.  Health care deals with patients' lives rather than a slot machine. But the gamble is there: to pay or not to pay. The pros and cons for each are striking.

On the one hand, I would have enormous grief about forking over cash to these cybercriminals. My hubris would make me believe we could solve the problem faster and cheaper than shelling out money to crooks. Why pay for something we can fix? On the other hand, what happens if we can’t fix it?

These decisions are not made in a vacuum. Input is needed from multiple departments and upper management. Most of all, the risk factor for what happens if we choose to solve our issue, as lives are at stake, is at play. Do we want to be Caesar’s Palace or MGM in this case?

Cybercriminals are outpacing companies’ prevention tactics by using AI to launch sophisticated, scalable attacks. AI-powered malware and automated hacking tools exploit vulnerabilities with unmatched speed and precision. They use algorithms to swiftly scan networks for weaknesses, adapt in real time and mimic legitimate user behavior to evade detection.

The statistics are alarming. According to Cybersecurity Ventures, global cybercrime costs are projected to reach $10.5 trillion annually by 2025, with AI-driven attacks playing a significant role.

With over 3,200 cybersecurity vendors globally, according to Gartner, part of the strategy is selecting the tools your business needs based on risk profile and industry.

Cybersecurity isn’t just an IT issue; it’s a fundamental business concern. Consider a hospital. If systems go down due to a cyberattack, IT can’t care for patients.

Medical staff must continue care, potentially resorting to pen and paper. While IT restores systems, front-line staff need training and plans to operate without digital tools.

Think of cybersecurity tools like safety features in cars. In the ’80s and ’90s, cars had seat belts and eventually ABS. Today, multiple airbags, backup cameras and advanced warning systems are standard. Cybersecurity has evolved similarly. Traditional defenses — firewalls, antivirus software and the like — are no longer sufficient.

Outdated security practices also can’t compete. An IT manager might say, “We patch our systems every Thursday.” But no team can manually address all vulnerabilities promptly. New threats emerge daily, and without AI assistance, keeping up is impossible.

AI-driven solutions like vulnerability management solutions continuously monitor systems, identify vulnerabilities in real time and automate remediation. They prioritize threats, allowing IT teams to focus on critical issues first. By integrating AI, businesses shift from reactive to proactive.

If adversaries use AI to enhance attacks, we must use AI to bolster defenses. AI-driven tools analyze vast data faster than humans, detect anomalies indicating breaches and respond in mil-

This scenario isn’t limited to health care. In a manufacturing plant hit by ransomware, production halts, revenue plummets. Operations need contingency plans to keep processes running, even manually. Without these plans, businesses risk significant financial and reputational damage.

Leaders must recognize that preparing for and responding to cyber threats is as much about business continuity as technology.

Despite escalating risks, many organizations over-rely on IT departments without executive support. This gap becomes glaring during outages when companies scramble without a plan. IT alone can’t resolve crises or keep the business running smoothly.

Operations teams must be involved in planning.

CEOs need to consider: How will your business operate if systems are down for an extended period?

Given the critical nature of cybersecurity, the company’s top IT and cybersecurity executives should report directly to the CEO or at least have seats at the executive table. If the business isn’t large enough for these roles, consider virtual or fractional CIO/ CISO services.

Together, they should formulate

contingency plans. They develop strategies addressing both technological defenses and operational continuity. When IT executives are part of leadership, cybersecurity and resilience become integral to strategic planning.

Here’s what business leaders need to do:

Educate yourself on AI and cybersecurity: Understand how AI is reshaping cybersecurity to make informed decisions.

Elevate IT leadership: Ensure your CIO/CISO reports directly to the CEO or has a seat at the executive table. Consider combining IT and resilience roles or fostering close collaboration.

Update basic security measures: Implement advanced tools like dndpoint detection and response, multi-factor authentication, enhanced email security, and end-user training.

Invest in AI-driven solutions: Allocate resources to AI-powered tools for threat detection, response and prevention.

Integrate IT and operations: Foster communication between leadership, IT, and operations to align cybersecurity strategies with business objectives.

Develop comprehensive plans: Create robust policies and incident response plans, including worst-case scenarios.

Conduct regular audits and drills: Routine assessments and drills prepare the organization for cyber incidents.

It’s time to ask ourselves: Are we leveraging AI to enhance cybersecurity, or are we falling behind? Do we have a plan involving both IT and operations? Is our IT executive involved at the highest levels? Is the CEO setting the tone from the top?

We have to accept that cybercrime is a never-ending war. We only “win” by protecting our businesses through preparedness. Business leaders must embrace AI not just for growth but as a shield against harm.

The tools are at our disposal, and the stakes have never been higher. It’s up to us to lead the way, integrating teams and strategies to safeguard our organizations’ futures.

Matt Loria is the managing partner and CEO of Auxiom, an IT and cybersecurity company.

Cybersecurity is a fundamental business concern. GETTY ImAGES

Prepare for a cyber incident before it happens

Cybersecurity articles and webinars are quick to advise what to do when a cyber incident happens. While this advice is extremely helpful — and I certainly have authored and presented many of these post cyber-event focused articles and webinars — my recent focus has been to advocate the steps one can take in advance of the cyber incident.

Claudia Rast is a shareholder based in Butzel Long's Ann Arbor office and is chair of the IP, Cybersecurity & Emerging Technology Group.

In other words, short of implementing the typical cyber defenses, what else should companies do? My simple response: prepare for the event as if it will happen and don’t assume your defenses are perfect. So, how does a company build that resiliency?

There are three basic steps: create the Incident Response Plan or IRP, recruit the Incident Response team, and implement robust and comprehensive training that includes full-scale tabletop exercises.

In my experience, it is the rare client that appears with its IRP in hand and IR team in the wings. Most cli-

ents need immediate help and advice, and hours if not days, can be wasted in the immediate aftermath of a cyber incident with the client wondering if its insurance policy will cover the event and, if so, what will it cover, whether its policy requires paneled experts (and if so, where does one find those experts), what laws apply, who needs notification and more.

When properly prepared and used, IRPs are well worth the time and energy it takes to prepare them because most of these questions will be answered as the IRP is drafted. IRPs become valuable roadmaps for navigating the early chaotic hours of a cyber incident.

In addition and as noted above, they are extremely useful tools during the process of their preparation, for as the initial IR team drafts the IRP, they must identify, connect with and gain buy-in from their internal and external IR teams and familiarize themselves with the function and intercon-

nection of the entity’s basic digital infrastructure.

The IRP and IR team are critical to the entity’s successful response and recovery from a cyber incident. The real trick is to ensure that the IRP does not languish on the company server, and the internal IR team does not forget its training. The IRP should be printed out and tucked into the laptop case or backpack of every internal IR team member, and training that includes tabletop drills should be an annual exercise.

Whether your IT staff is internal or external, unless their day job involves digital forensics and cybersecurity, you should engage specialized and experienced third parties to assist with incident response. Experts in forensics, law and public relations are the main external partners of the IR team, and their skill and experience are invaluable.

Cyber insurance policies will generally list paneled legal and forensic teams, but it is the rare insurer that will refuse qualified experts as long as they agree to the insurer’s panel rates. Once vetted and engaged, these external IR team members can conduct periodic vulnerability assessments

and be active participants in your tabletop exercises with internal IR members. Contact your insurance broker to confirm pre-approval of these external IR team members.

Access resources:The Cybersecurity & Infrastructure Security Agency is a federal agency that offers free tools and templates for incident response, such as cyber hygiene services that include vulnerability scanning and web application scanning.

CISA also offers a wide variety of tabletop exercise packages for download.

The FBI is another helpful partner when the cyber incident occurs. The Office of Private Sector oversees the bureau’s effort to increase collaboration and information sharing with the private sector. Building relationships with the FBI and/or CISA agents in advance of an event allows sufficient familiarity for all to be ready, willing, and able to work together when the inevitable incident happens.Perhaps the most important message is the realization that you are never “all set.” The measures you implement, the tools you deploy and the training you roll out must be subjected to continuous

scrutiny and updating.

Everyone from the C-suite to the storeroom must participate in — successfully — cyber-scenario training. Every person in your company represents a potential pathway for threat actors to find and exploit. In sum, draft your IRP, recruit and assemble internal and external IR members, and conduct periodic tabletop exercises. These measures create the resilience needed to survive a cyberattack.  Entities that actively prepare and train for cyber incidents are those that recover faster, better, and with far less economic loss than those who do not.

The Cybersecurity & Infrastructure Security Agency is a federal agency that offers free tools and templates for incident response. CrAIN’S DeTroIT bUSINeSS

By Kate Carlson

At least 13 contractors have filed claims seeking payment for more than $6 million in work to relocate furniture maker American Seating Co.’s headquarters to the south side of Grand Rapids. At least one contractor to file a construction lien involving the project says construction stopped months ago on the seating manufacturer’s new headquarters at 1040 40th St. SE, a former Steelcase Inc. property where it plans to move from its longtime Grand Rapids west side facility.

Hager’s company is one of more than a dozen firms that have claimed construction liens involving the project after receiving partial or no payment for their work, according to lien claims filed over the past five months with the Kent County Register of Deeds.

As of Nov. 6, 13 contractors had filed construction liens totaling more than $6 million on the property:

w Sparta-based Armock Mechanical Contractors LLC filed a $1.6 million lien on Nov. 5

w Hudsonville-based Galveston Painting filed a $54,572.59 lien on Nov. 5

Renovations began in the summer of 2023 to repurpose the site for American Seating. The company secured a long-term lease for the property after selling its legacy manufacturing campus — located at 901 and 940 Broadway Ave. NW and 564 11th St. NW — in January this year to furniture maker Mien Co.

American Seating is still operating out of its Broadway Avenue location that it has been leasing from Mien Co., said Mien Co. CEO Remco Bergsma.

“The moment they move out, we’ll move in,” Bergsma said, adding that American Seating has been a “great tenant.”

“We’ve taken a small portion of the space that we’re using for storage,” Bergsma said.

When Crain’s Grand Rapids Business first reported on the relocation, American Seating officials planned to complete $8.6 million in renovations for the new headquarters and move to the site by the end of 2023. The company, which specializes in manufacturing transportation seating, dates back to 1886 when it was founded as Grand Rapids School Furniture on the city’s west side.

The renovations were nearly complete when Grand Rapids-based Grand Valley Wood Products Inc. stopped work on the project in July this year, said the company’s president, Shawn Hager.

“Within the last two weeks of when we were on site, we started finding out other contractors were stopping work because of nonpayment, so at that point we pumped the brakes,” Hager said.

w Zeeland-based Town & Country Group filed a $365,878.12 lien on Oct. 30, after a $40,344 lien on Aug. 30

w Grand Valley Wood Products filed a $274,020 lien on Oct. 29

w Kentwood-based Thornview Electric Co. LLC filed a $2,075,520.39 lien on Oct. 28

w Schepers Brothers Company Inc., based in Byron Center, filed a $791,044 lien on Oct. 16

w Innovative Iron Inc., based in the city of Wyoming, filed a $100,459.14 lien on Oct. 2

w Sherwin Williams-Co., based in Cleveland, Ohio, filed a $6,649.07 lien on Sept. 24

w Grandville-based Johnson’s Carpet One filed a $183,221.26 lien on Sept. 10

w Otis Elevator Co.’s division based in Farmington Hills filed a $132,500 lien on Sept. 9

w Rockford-based Glass Design Inc. filed a $338,989.10 lien on Sept. 3

w Rayhaven Group Inc., based in Livonia, filed a $34,415.81 lien on Aug. 27

w Grand Rapids-based Thermline Inc. filed a $81,388.33 lien on Aug. 16

Ghafari Associates is the architect for American Seating’s new headquarters, and First Companies Inc. is the construction lead. Leaders at First Companies and American Seating did not return requests to comment for this story.

Property records show the nearly 39-acre property is owned by a Canadian company doing business as 1040

American Seating is yet to move to a new headquarters on 40th Street as contractors demand more than $6 million for work they’ve completed at the site.

KATE CARLSoN

Value Partnerships: Making health care work better for 20 years

Every day we hear from customers and members who want safe, high-quality care that delivers good outcomes at a more manageable cost. That’s why for the past 20 years, Blue Cross Blue Shield of Michigan, together with 33 physician organizations, 100+ hospitals and 20,000 physicians across the state, have worked closely on a collection of programs that create a more efficient, affordable, highperforming health care system.

These programs are called Value Partnerships. The results are outstanding and have established Blue Cross Blue Shield of Michigan as nationally recognized leaders in value-based care.

Our groundbreaking work with doctors and hospitals across Michigan has improved care quality, reduced complications and errors, prevented unnecessary hospital stays and ER visits and as a result has prevented roughly $6.3 billion in health care costs.

This is a direct result of our collaborative work statewide to transform the health care delivery system and align payment with performance and outcomes. Physicians and health care providers earn value-based incentives that are tightly connected to their quality and outcome results.

And higher quality and better outcomes translates to fewer complications, less duplication and waste, better preventive care, shortened recovery times, fewer ER visits and inpatient hospital stays, because patients are getting the care they need in the most appropriate setting at the most appropriate time.

Disconnected care, volume-based payment

Twenty years ago, the Michigan health care system was fragmented. Health care was not well coordinated among different providers or different care settings. Data and information

sat in closed silos. Primary care was challenged, with insufficient infrastructure to support practice transformation. And in our fee-forservice environment, health care insurers paid for each service provided to a patient in a health care setting. The incentive was on volume rather than value.

Something had to change. So Blue Cross and a small group of physician leaders gathered to commit to building a better way – a highperforming system of care that focused on collaboration and coordination; with payment models that compensated providers for higher quality and better outcomes, and support to build enhanced provider capabilities.

Through the Blue Cross Value Partnerships program, we launched value-based payment models that assisted the provider community and aligned reimbursement more closely with quality, outcomes and patient experience.

Statewide impact, value-based leadership

Over the years, the Value Partnerships portfolio of programs continued to grow. What began with a small group of Michigan physician and hospital leaders is now a collection of robust, statewide programs where physicians, hospitals and other health care providers collaborate to improve the quality, safety and processes of health care.

Patients throughout Michigan receive safer, higher quality care because of the comprehensive progress being made through the Value Partnerships programs. In fact, Michiganders can find a Value Partnerships participating physician in all but three of Michigan’s 83 counties.

care systems are improving the way they deliver care for all patients, not just those who happen to be Blue Cross members.

Better care, better outcomes, better patient experience statewide

Through collaboration within Value Partnerships initiatives, Michigan physicians and hospitals have reshaped the way care is delivered, resulting in widespread change in care processes that improve the health care experience. For example,

• Primary care is now largely team-based. This enables patient-centered care that is coordinated throughout care settings and providers. Through Blue Cross’ nationally leading Patient-Centered Medical Home (PCMH) designation program, today 1,591 primary care practices across Michigan have earned the Blue Cross PCMH designation. PCMH practices provide teambased medical care focused around each patient’s unique health needs.

• Prescribing medications is now done electronically. E-prescribing improves prescription safety and accuracy. In 2015, the e-prescribing rate was just 6.5%, so Blue Cross launched an initiative to reward physicians for prescribing electronically. In 2022, the e-prescribing rate increased to 90% and we retired the initiative.

• Important patient data is connected through the Michigan Health Information Network (MiHIN). Multiple Value Partnerships initiatives spurred every hospital, physician organization and more than 60% of skilled nursing facilities in the state to connect to MiHIN. Now, they transmit 82 million messages per month via the network, notifying physicians when their patients have been seen in the ER, admitted, discharged or transferred from the hospital and what their lab results are. This enables physicians

to quickly follow up with their patients and ensure care is coordinated.

• Prescriptions for post-surgical opioid medication is greatly reduced. To reduce the risks of patients developing opioid dependency, surgeons now prescribe a very small amount of opioid medication, typically less than 10 pills, for 27 common surgeries. Thanks to Value Partnerships’ efforts, surgeons were able to compare data and develop appropriate prescribing guidelines.

• More than 20 BCBSM-sponsored statewide collaborative quality initiatives (CQIs) address many common and costly areas of surgical and medical care. Best practices coming from these initiatives have reduced or prevented complications, shortened recovery times, prevented re-admissions, improved outcomes and saved money.

Together with physicians, physician organizations and hospitals, Value Partnerships programs have prevented $6.3 billion in health expenses while making Michigan a safer, higher quality place to receive care. The Value Partnerships program has been a win for Blue Cross, its customers, its provider partners and most importantly, the Michigan patient population.

For more information about Value Partnerships, visit valuepartnerships.com.

By Blue Cross Blue Shield of Michigan

Soccer league, team to be announced soon for Amway Stadium

By Kate Carlson

Developers of a professional soccer stadium just west of downtown Grand Rapids aim for the much-anticipated league and team that will call it home to be announced next month.

At a Nov. 18 event announcing that Amway Corp.’s $33 million donation secured the naming rights for what will be called Amway Stadium, Grand Action 2.0 co-chair Carol Van Andel said the partners hope to announce the league and team in December.

“The professional team will be announced next month, that’s all being organized and pulled together with marketing and branding,” Van Andel told Crain’s Grand Rapids Business. “It’s so exciting. I’m just really excited for the city. I look at all of these projects as a piece of the puzzle and we are strategically locating them all so the fabric all comes together and makes it more enjoyable for families.”

“It’s all coming together,” Van Andel said of the future team and league.

Grand Action 2.0 co-chair Dick DeVos declined to provide details on the soccer team.

“We are optimistic that things are moving in the right direction,” he said.

Grand Action 2.0 officials have said construction on Amway Stadium is expected to start in the spring of 2025 and wrap up in early 2027.

When it gets announced, the new soccer team will join the Grand Rapids Rise women’s volleyball team as the most recent professional sports team for Grand Rapids. The Rise is owned by DP Fox Ventures LLC, which also co-owns the Grand Rapids Griffins hockey team. Dan DeVos is the chairman and CEO of DP Fox Ventures.

As for professional soccer, the DeVos family has been a limited partner in Major League Soccer (MLS) team Orlando City Soccer Club since July 2021, when the Wilf family — which owns the Minnesota Vikings of the National Football League — acquired a majority ownership in the franchise. According to an announcement of the deal at the time, Dan

DeVos serves as the family’s lead representative for the Orlando soccer team.

Amway CEO Michael Nelson told Crain’s that the company has not yet been directly involved with selecting a soccer team to play at the stadium, but that company officials plan to stay involved with those discussions.

“Our vision is helping people live better, healthier lives and this (stadium) aligns nicely with that,” Nelson said. “Amway is a global company and this is the No. 1 global sport, so to bring this asset to the Grand Rapids and West Michigan community is just something we’re truly excited about.”

The lead donation from Amway is another major step forward for the stadium, Dick DeVos said.

“A big characteristic of Grand Action has been this idea of a lead donor that really sets the tone for a project and puts us in the position where we have the kind of private sector commitment that says this is really serious,” DeVos said. “That reinforces public sector commitment, and reinforces other private sector contributions and supporters. That’s a really important and powerful signal across the community and to soccer enthusiasts as well. We need to hear their voices also.”

Grand Action 2.0 still has about $10 million in private contributions to complete funding for the $175 million project.

The private donation portion of the stadium’s fundraising is over 83% to its $60 million goal, said Kara Wood, executive director of Grand Action 2.0. In addition to Amway’s $33 million contribution, more than $17 million of private funds have been committed for the project, Wood added.

“(The lead donation) is just another important step forward and we’ll continue to get ready for construction season,” Wood said.

At a recent Kent County meeting, both Rick Winn, president of AHC Hospitality, and ASM Global General Manager Rich MacKeigan said the stadium will host “the highest level of soccer in the state of Michigan,” in addition to community events on non-game days.

Amway Corp. secured the naming rights of the professional soccer stadium with a $33 million donation announced on Nov. 18. | PRoGRESSIvE ComPANIES

Good board members support nonprofits with their time, talents and treasures. Great board members do all of that and more. These 22 leaders treat board service as the second job that it is, applying their professional skills to boost their chosen organization’s profile, finances and outreach. They create and champion DEI efforts, generate new fundraisers and breathe new life into existing ones, and mentor other board members. Their efforts, described here, strengthen all manner of area nonprofits, from social service agencies to public entertainment venues.

Methodology :The individuals featured did not pay to be included. Their profiles were written from the nomination/ application materials submitted. This list is not comprehensive. It includes only individuals for whom nominations were submitted and accepted after a review by editors. Nominees must be based in the West Michigan area and serve on the board of a charitable organization that serves the public and has active fundraising campaigns. Special Projects Editor Tim Gortsema, tim.gortsema@crain. com, managed this Notable Nonprofit Board Leaders report. For questions about how to nominate someone for a future Notable award program, or to find out which industries will be highlighted in 2025, visit our Nomination Page or email grandrapidsrecognitions@crain. com.

JC Anderson Chair

Lakeshore Excellence Foundation

Scope of work: JC Anderson is a retired global senior vice president of operations at Whirlpool Corp.

Nonprofit contributions: Over the past 12 years, Lakeshore Excellence Foundation has raised more than $7 million with Anderson as chair and grew its board from 8 to 27 members while instituting three new fundraisers.

Biggest career win: Anderson developed an all-encompassing product cost productivity measure for Whirlpool that initially covered 22,000 North American employees and then implemented globally.

Community/industry involvement: He is involved with the Rotary Club and serves on the board of Well of Grace. Anderson also helps lead the United Way retiree campaign at Whirlpool and is executive chair for volunteer recruitment for the Senior PGA golf tournament.

Veneese Chandler

Immediate Past Chair

The Salvation Army of Kent County

Scope of work: Veneese Chandler has been executive director and CEO of Family Outreach Center for 41 years. The organization provides outpatient mental health services, substance use disorder treatment, jail mental health services, children’s in-home and school-based services, parenting and family support, prevention and education services, and violence prevention programs. Nonprofit contributions: She has been on The Salvation Army’s Advisory Board since 1998. Biggest career win: She is committed to advocating for the needs of the underserved, people of color, low-income individuals, families and children with specific needs in Grand Rapids, Kent County and throughout Michigan.

Community/industry involvement: Chandler is chair of the Urban Core Collective and an associate pastor at Lighthouse Full Life Center Church.

Matt Becker Chair

John Ball Zoo

Scope of work: As national managing principal of tax, Matt Becker is responsible for the strategy and operations of BDO’s tax practice in the U.S., leading more than 4,000 tax professionals and serving as a member of BDO’s executive leadership team working with tax leaders around the globe. Nonprofit contributions: Over the past decade, Becker spearheaded the largest capital campaign in the zoo’s history.

Biggest career win: When Becker was appointed in 2019 to his current role, annual revenue of BDO’s tax practice was approximately $540 million. Today, that figure is roughly $1.2 billion.

Community/industry involvement: He is a committee member with the Association of International Certified Professional Accountants and a member of Young Presidents Organization.

Katie Chapman Chair

Michigan Sustainable Business Forum

Scope of work: Katie Chapman, a senior sustainability engineer, leads Haworth’s circular economy initiatives, ensuring current and future products adhere to circular design principles.

Nonprofit contributions: She is leading the organization’s expansion from a regional group to a statewide program, which includes a pending rebrand and bylaw revision.

Biggest career win: Haworth’s latest task chair, Breck, launched at Neocon this year and received a Best of NeoCon sustainability award.

Community/industry involvement: She has worked with the Green Building Initiative’s Building Industry Advisory Committee, Single-Ply Roofing Product Category Rules Committee, and the ASTM D8.24 Sustainability Committee.

Kari Bliss Vice chair

Michigan Sustainable Business Forum

Scope of work: Kari Bliss, sustainability principal at Padnos, supports Michigan Sustainable Business Forum membership advancement and takes a leadership role in development.

Nonprofit contributions: She played a key role in modernizing the organization, supporting a rewrite of its bylaws, mission and strategic plan to position it as a statewide organization.

Biggest career win: Under her leadership, Padnos developed 36 innovative solutions to address complex circular economy challenges.

Community/industry involvement: Bliss is a frequent guest lecturer, member of the Materials Management Plan Committee for Ottawa and Kent counties, and committee member with the Michigan and Grand Rapids chambers.

Lisa Cooper Vice chair

North Kent Connect

Scope of work: As founder and chief people officer of Cooper People Group, Lisa Cooper leads all aspects of the HR consulting firm’s operations, strategy, and growth, working with more than 130 clients.

Nonprofit contributions: She is one of the founding members of North Kent Connect’s governance committee and its longest-serving chair to date.

Biggest career win: Cooper successfully led major organizational restructures following mergers, acquisitions and startups. She also customdesigned a leadership development program for emerging professionals.

Community/industry involvement: She is a board adviser for First Merchants Bank, on the Leadership Council of the Small Business Association of Michigan and a 2025 member of Leadership Grand Rapids.

Elizabeth BovardStrong Director

Construction Allies in Action

Scope of work: Elizabeth Bovard-Strong, executive vice president of Builders Exchange of Michigan, founded Construction Allies in Action at the end of 2020 to help underrepresented construction contractors create and build sustainable businesses and generational wealth.

Nonprofit contributions: She has collaborated with other community partners to support members of the organization, obtained grants and created a gala to raise money. Biggest career win: Securing a $20,000 grant from Grand Rapids’ economic development office for Construction Allies in Action. Community/industry involvement: Bovard-Strong is a board member with Guiding Light, Builders Exchange Network, and serves on Ferris State University’s industry advisory board.

Bob

President SHOUT for South Haven

Scope of work: Bob Copping, a former chief financial officer at Raytheon Co. and security officer in the U.S. Army, is president of SHOUT for South Haven, a civic-minded group focused on community enhancement. Nonprofit contributions: For more than 30 years, SHOUT has undertaken civic projects funded by private contributions including bridge flowers, downtown sculptures and SHOUT Park. Biggest career win: Copping spearheaded an initiative to raise funds for a winter gathering place, highlighted by an outdoor fireplace, at Dyckman Park. Community/industry involvement: He is a member of South Haven Rotary and South Haven Yacht Club and served in leadership capacities with Michigan Maritime Museum, South Haven Community Foundation, South Haven Chamber of Commerce and Board of Public Works.

Copping

David Hathaway Member

The Salvation Army of Kent County

Scope of work: Until June 2024, David Hathaway served as senior vice president and general counsel of Mol Belting Systems (MBS) Inc., a manufacturer of conveyor belting and motors.

Nonprofit contributions: Hathaway was The Salvation Army’s representative to help create the Community Food Club. He also led the effort to build the Kroc Center.

Biggest career win: In June, Hathaway led the sale of an MBS division to Belt Power LLC, a major player in the conveyor belting space in North America.

Community/industry involvement: He is a founding member of Grand Angels and works with Boy Scouts of America, Heart of West Michigan United Way, Valparaiso University School of Law, Degage and Interfaith Hospitality Network.

Shelley Irwin Member

Girl Scouts of Michigan Shore to Shore

Scope of work: Shelley Irwin is the host and producer for The Shelley Irwin Show, a news magazine talk-show format on the local NPR affiliate, Monday through Friday.

Nonprofit contributions: She chairs the organization’s Fund Development & Events and Board Development committees.

Biggest career win: Irwin has received numerous awards and recognitions with the most recent coming this year from Michigan Women Forward for her work to advance the cause of women and girls

Community/industry involvement: Her community work includes the Kent County Parks Foundation, Michigan Women’s Foundation, Hope Network, Paws for a Cause and Cherry Health Foundation, among others.

Missy Jackson Chair

AYA Youth Collective

Current scope of work: Missy Jackson is the first female partner of Vantage Group and led the way to adding four consultants to expand the consulting group’s reach nationally.

Nonprofit contributions: Jackson served as board chair through a merger in 2020 and boosted AYA’s budget from $1.1 million to $6.3 million by soliciting major and recurring donors.

Biggest career win: This year she became majority share owner and president of Vantage Group and led the company to certification as a woman-owned small business at the state and federal levels.

Community/industry involvement: Jackson was one of the first board members for Affinity Mentoring, helping set strategic direction and growth goals, and also served three years as board president for Herman Miller Cares.

Congratulations Rachel Mraz

Nonprofit Board Leader

We congratulate Rachel Mraz and all honorees for this recognition of their leadership in our community.

Catherine Jacobs Chair

Senior Neighbors

Scope of work: As senior counsel at Warner Norcross + Judd LLP, Catherine Jacobs advises clients on estate planning, elder law and special needs planning. She is solely responsible for supporting Warner’s nine Michigan offices in those legal matters.

Nonprofit contributions: Jacobs is involved in developing new initiatives and reinvigorating existing successful funding measures, contributing to a 28% increase in Senior Neighbors’ revenue.

Biggest career win: Leading the strategic planning for Warner’s elder law and disability rights practice that includes helping corporate clients with elderly or disabled family members.

Community/industry involvement: Jacobs serves on the boards of Elder Law of Michigan and Caregiver Resource Network.

Ashley Landis President Creston Neighborhood Association

Scope of work: Ashley Landis is the global future talent lead at Jacobs Solutions and oversees early career recruitment efforts across North America.

Nonprofit contributions: Landis played a pivotal role in the successful launch and development of the Creston Farmers Market. She also championed initiatives like the Creston Food Club and the Art Bash for Creston.

Biggest career win: Her leadership in launching the Creston Farmers Market, which just completed its first year and successfully connected local vendors with community members facing food insecurity.

Community/industry involvement: Landis serves on the Water Leadership Institute Steering Committee for the Water Environment Federation.

MATT BECKER A Champion

for Wildlife and Wild Places

Your remarkable leadership as Board Chairman inspires us to give our very best each day, welcoming over 800,000 guests, caring for more than 1,000 animals, and advancing wildlife conservation across Michigan and the world. Congratulations to you and our other recognized board members. We greatly appreciate your dedication and support.

Warm regards, The John Ball Zoo Team

THE ART OF LEADERSHIP

Congratulations to Candace Matthews, Board of Directors Chair, on her recognition as one of Crain’s 2024 Notable Nonprofit Board Leaders. At Frederik Meijer Gardens & Sculpture Park, she has been Co-Chair, part of the CEO Search Committee, and is a Diversity, Equity, Inclusion and Belonging Committee member. Contributing in more ways than one, she is cultivating a legacy of accessibility for all. Candace believes in leaving something bigger than herself, and that’s exactly what she’s doing.

Candace Matthews Chair

Frederik Meijer Gardens & Sculpture Park

Scope of work: Candace Matthews recently retired as the chief reputation officer responsible for overseeing Amway Corp.’s global reputation strategy, corporate social responsibility and Amway brand.

Nonprofit contributions: She led the search committee for a new president and CEO at Meijer Gardens and helped launch the Amway-Meijer Fund for Education.

Biggest career win: Matthews served as Amway’s regional president of the Americas, increasing revenue by 20% in that region.

Community/industry involvement: She is on the boards of MillerKnoll, Societe BIC SA, AptarGroup, Fifth Third Bank, Corewell Health Foundation, and Figure Skating in Harlem, which helps girls of color develop life skills and academic success.

Rachel Mraz Chair

Equest Center for Therapeutic Riding

Scope of work: Rachel Mraz, a wealth management adviser and senior vice president for Merrill Lynch, works with individuals, endowments and institutions to outline financial goals and establish strategies. She manages nearly $1 billion in client assets.

Nonprofit contributions: In addition to Equest, she sits on the boards of John Ball Zoo, Davenport University Foundation, Davenport University, Economic Club of Grand Rapids and the Eileen DeVries Family Foundation (president).

Biggest career win: Chairing and completing the more than $3 million Vision 2020 capital campaign for the Equest Center for Therapeutic Riding.

Community/industry involvement: She has been on the Equest Center board for over 20 years and chaired and completed two capital campaigns.

Rachel Mraz

BOARD PRESIDENT

On board

The job search site Indeed lists six common traits nonprofits are seeking when filling board positions.

Willingness: Candidates who are eager to participate and have a personal connection to the organization.

Compatibility: Individuals who can work well with others and make a collective decision.

Expertise: Specific skills, such as legal, finance and HR, that are relevant to the organization.

Good reputation: A strong presence in the community to help with public fundraisers.

Connections: Experience with certain political or social groups to expand the nonprofit into new areas.

Wealth: Since a nonprofit does not necessarily have an income stream, the ability of board members to financially support the organization is sometimes a consideration.

EQUE S T CE NTER FOR THERAPEUTIC RIDING

Congratulations and Thank You, Rachel. Your 21 years of leadership and generosity have enabled us to improve the lives of thousands.

Tony Roussey Chair

West Michigan Construction Institute

Scope of work: EV Construction

COO Tony Roussey has been an industry leader for decades. As a member of the executive committee, he plays a crucial role in overseeing daily operations, with a particular focus on employee care and safety.

Nonprofit contributions: Under his leadership, WMCI has consistently surpassed enrollment targets, beat budget projections and expanded its program offerings. .

Biggest career win: Educating hundreds of construction workers and spreading the importance of construction safety through the Alive365 Safety Week program.

Community/industry involvement: He developed EV’s corporate safety manual and Safety Week, training an estimated 5,000 people over the past 17 years.

Sue Schweim Tellier President Women In Defense

Scope of Work: Sue Schweim Tellier is president of JetCo Federal, a packaging solutions and logistics provider.

Nonprofit contributions: Tellier leads Women in Defense (WID) Michigan and manages relationships with defense industry stakeholders, oversees board functions, increases membership, raises scholarship funds, conducts mentorship and fundraising events, and secures and retains industry sponsors.

Biggest career win: In 2023, WID Michigan became the largest chapter in the country.

Community/industry involvement: Tellier is immediate past chair of the WID National Council, vice chair of Women Impacting Public Policy, immediate past chair of the Small Business Association of Michigan, and a board member for Michigan Strategic Fund.

We improve quality of life through equine-based therapy to physically, mentally and socially/emotionally challenged individuals. Our unique program integrates academic, social and physical skills, using the horse as a catalyst.

Michael Sytsma Chair

Rotary Club of Grand Rapids Charities Foundation

Scope of work: Michael Sytsma is West Michigan president for KeyBank in downtown Grand Rapids.

Nonprofit contributions: He serves as board chair for GR

Rotary’s Charities Foundation and also sits on the boards of John Ball Zoo and Covenant House of Michigan. Sytsma is past board chair of Priority Health and co-founder and president of Christophe’s Children.

Biggest career win: In 2023, Sytsma helped establish KeyBank in West Michigan, the 200-year-old financial institution’s first presence in the region.

Community/industry involvement: KeyBank has contributed to Mel Trotter Ministries and Family Promise programs locally, and Sytsma’s charitable efforts range from Grand Rapids projects to helping children in the Congo.

John Teeples Chair

Emmanuel Hospice

Scope of work: John Teeples is the founder of Teeples and Teague Law PLLC, which specializes in business, employment and estate planning. He moved to of counsel with the firm two years ago.

Nonprofit contributions: As both a longtime hospice volunteer and board member, Teeples has used his legal and business experience to spearhead Emmanuel Hospice’s long-term planning.

Biggest career win: Teeples launched the Winter Coats and Boots Ministry for people experiencing homelessness at one shelter and expanded it to now include 30 volunteers serving 65 organizations across six counties.

Community/industry involvement: He serves on the board of Adelanté Youth Mission and is a member of Men of Emmaus Ministry and the Knights of Columbus.

Steve Tibbe

Member

Fans of Valley Field

Scope of work: Steve Tibbe, the founder of photography property tour company Real Space GR, helps set up and run 10 to 25 large community events per year for Fans of Valley Field with budgets in the tens of thousands of dollars.

Nonprofit contributions: The events, all of which operate on a volunteer basis, attract business and individual donors to support the baseball field restoration process.

Biggest career win: By combining engaging activities with strategic fundraising, Tibbe helps Fans of Valley Field advance its mission to enhance the park’s facilities and ensure its future sustainability.

Community/industry involvement: Tibbe is an Entrepreneur in Residence at Michigan State University and volunteers with Local First in West Michigan.

Ashley Ward Member

Wedgwood Christian Services

Scope of work: Ashley Ward is founder and CEO of W Talent Solutions and responsible for talent strategy, brand management and national expansion efforts for the 12-person firm.

Nonprofit contributions: As chair of the fundraising and advancement committees at Wedgwood, Ward oversees a total budget of $31 million and is responsible for meeting an annual giving goal of $2.35 million.

Biggest career win: She is the recipient of several awards recognizing her for community advocacy and influence, entrepreneurialism and young leadership, as well as startup of the year for her firm.

Community/industry involvement:

In addition to Wedgwood, Ward is on the board of the Grand Rapids Downtown Improvement District and a member of the YWCA Fund Development Committee.

Cameron Young Chair

ICCF Community Homes

Scope of work: Cameron Young is director of marketing and customer experience at familyowned distribution company Behler-Young.

Nonprofit contributions: Young has worked to improve overall communication and transparency within the policy governance model the board uses, helped inaugurate an advancement committee, and supported the launch of the Building with Faith campaign.

Biggest career win: He developed the B-Y Cares program, which formalized charitable contributions and volunteer time.

Community/industry involvement: He supports several community organizations, including Disability Advocates of Kent County, Grand Rapids Public Museum, Mary Free Bed Rehabilitation Hospital, World Affairs Council of Western Michigan and Gilda’s LaughFest.

WEDGWOOD CHRIS

Ending tipped minimum wage a disaster for small bars

As a Michigan bar owner, I’ve built my business over the years through long hours, hard work, and a team of employees who know how to provide great service and make a night out memorable. But now, there’s a proposal that could change everything — eliminating the tipped minimum wage. While I’m all for fair wages and treating employees right, raising the base pay of tipped employees to the full minimum wage would increase my payroll by a staggering 280%.

For a small business, that kind of jump simply isn’t sustainable.

Here’s why that would hurt not just me, but also the very employees this proposal is meant to protect.

First, a little background on how wages work in Michigan’s bar and restaurant industry. In our state, tipped workers are guaranteed to make at least the regular minimum wage if their tips fall short in making up the difference between the regular minimum wage and the tipped minimum wage. This means that, by law, tipped employees can never make less than the state minimum wage, but they do have the opportunity to make a lot more. According to data from various state and national sources, the average server in Michigan makes somewhere around $26/hr. Serving jobs, unlike most other professions, also provide a high level of sched-

COMMENTARY

uling flexibility, making them ideal for college students, people with second jobs and single parents. Unlike many 9-to-5 positions, serving roles frequently offer part-time shifts, evening hours and weekend opportunities, allowing workers to fit their schedules around other commitments.

By raising the regular minimum wage, our legislature would already be ensuring that servers are making what they consider a living wage. And by keeping the tipped minimum wage, they wouldn’t be putting

the brunt of the cost on business owners, who would then pass those costs on to consumers, who would then tip less. Our system, as it functions now, is a model where everyone wins. Abolishing the tipped minimum wage ensures that everyone loses.

Bars and restaurants operate on razor-thin margins, and a massive increase in wage costs would mean some would have no choice but to pass costs on to customers, cut employee hours, or even reduce staff. It’s ironic because the very em-

ployees this proposal is meant to help would end up with fewer hours and fewer tips or, worst case, no job at all. And for customers, it would mean higher drink prices, fewer options on the menu, and a likely downturn in service quality — nobody wins.

If this change is implemented, many small businesses will likely have to replace tipped staff with counter-service models, where customers place orders directly and the personal touch we all enjoy in bars and restaurants fades away. Most places have regulars that appreciate the rapport they’ve developed with staff over the years; it’s a part of why they return again and again. But forced changes like this could lead to a sterile, fast-casual environment that robs customers of the personal service and experience that makes a night out special.

Finally, let’s consider what would happen to our local economy. When small bars like mine have to close, downsize, or completely change their model, that’s fewer jobs in our community, less tax revenue, and fewer vibrant social spaces for people to gather. Small bars are often family-run and community-oriented, and a policy that destabilizes our model would have wide-reaching effects.

Ending the tipped minimum wage might sound like a simple solution to a complex issue, but for Michigan’s service industry, it would cause more problems than it would solve. Let’s continue to support our workers — but let’s do it in a way that keeps servers happy and small businesses alive and thriving.

Nessel’s climate lawsuit will damage Michigan’s economy

Michigan has added 24,000 manufacturing jobs since 2021, making it the eighth-highest-growth state in America. This growth is being threatened by a frivolous lawsuit that will raise energy prices while having no impact on global temperature.

In late September, Michigan Attorney General Dana Nessel hired three out-of-state, politically connected law firms that have received millions of dollars from special interest groups to sue oil and gas companies for “causing” climate change, granting them the titles of Special Assistant Attorneys General. These law firms stand to make tens of millions in payouts, including 10% of the first $150 million they recover from these companies, while businesses and consumers pick up the tab in the form of higher gas and energy prices.

If this lawsuit succeeds, it will severely damage the very businesses that serve as the primary drivers of Michigan’s economy. Michigan’s robust manufacturing in-

dustry depends on affordable, reliable energy. Without a stable supply of fossil fuels, they won’t have any viable alternatives to power their high-powered machinery, logistics and vehicles. Renewable energy is not yet capable of supporting Michigan’s massive industrial needs. When Michigan businesses can no longer count on affordable energy, they will look to other states with friendlier regulatory environments to import the difference. This could permanently erode many of the manufacturing jobs Michigan has recovered since the COVID-19 recession.

The ripple effects from this lawsuit would extend far beyond the manufacturing sector.

For example, under the belief that gas-powered vehicles are contributors to climate change, they could also go directly after Michigan’s automakers. That is a problem when considering that 92% of all vehicles sold in the United States are gas-powered, and Michigan auto workers work on most of those vehicles. Further,

studies show that ending fossil fuels (which this climate suit would help to do) would eliminate 117,000 American auto jobs. Consumers, already battered by inflation, would see gasoline and other prices rise. Oil and gas companies would be forced to raise prices to cover the billions in penalties they would incur, which would drive up the cost of everything from cars to agriculture to retail businesses — all of which are vital contributors to Michigan’s economy. These higher prices would hit working families the hardest as they spend a larger share of their income on these things compared to upper-income families.

A successful lawsuit would have no impact on carbon emissions or average global temperature.

sions to zero (which is highly unlikely, to say the least), then worldwide emissions would fall by 0.33%, which would have no impact on average global temperature.

U.S. carbon emissions have fallen by 17% between 2005 and 2023, from 6 billion tons to 5 billion tons, as a consequence of the country increasingly using market-based solutions such as fracking and using natural gas, rather than coal, to generate electricity.

Market-based solutions, which emerge naturally from the incentives given by the

U.S. carbon emissions have fallen by 17% between 2005 and 2023, from 6 billion tons to 5 billion tons.

Approximately 40 billion tons of carbon dioxide were emitted in 2022. China was the largest emitter at 13 tons and the U.S. was second at 5 billion tons. Michigan comprises approximately 3% of the U.S. population. Assuming that Michigan is responsible for 3% of U.S. carbon emissions and this lawsuit drives Michigan’s emis-

profit and loss system of the U.S. economy, will do far more to reduce carbon emissions and global temperatures than a frivolous lawsuit that stands to make politically connected law firms millions at the expense of working families.

Hopefully, the state’s courts let the free market work and show Nessel’s band of out-of-state trial lawyers the door.

Christopher Douglas, Ph.D., is professor of economics at the University of MichiganFlint.

Bob Quay is the owner of Bob’s Bar in Grand Rapids.

The Right Place searches for strategic new industrial sites

By Mark Sanchez

As Microsoft Corp. scouted the West Michigan landscape for a site to potentially develop a data center, The Right Place Inc. set out to identify and vet sites for future industrial development.

Microsoft buying properties that together cover nearly 600 acres south of Grand Rapids took two large parcels off the board for possible development at a time when the region’s vacancy rate for industrial real estate sits at just 2.5%, which is less than the national average and the lowest rate among the top 50 markets in the U.S.

Backed by a $4 million grant, The Right Place’s strategic site-assessment work has identified more than 20 potential high-priority sites across the region for industrial development. The parcels range from eight to more than 200 acres and collectively total more than 1,800 acres, The Right Place President and CEO Randy Thelen said.

The effort to identify parcels that developers can use for industrial projects occurs as data centers are “absolutely booming when we think about ways that we’re going to make our way through this

tainly one that we can lean into and participate in here in Michigan, and particularly here in West Michigan,” Thelen said.

In his presentation, Thelen cited information from Data Bridge Market Research that indicates spending on artificial intelligence infrastructure for data centers will reach more than $422 billion by 2031.

Data centers, the energy grid and battery storage are three key sectors that represent growth opportunities for the Grand Rapids area, Thelen said.

Tech giants like Microsoft, Apple and Google have “generally stayed away from Michigan and for the most part stayed outside of the Midwest” with data-center projects, Thelen said. That’s changing and “they’re now looking to come,” drawn by a cooler and more stable climate than the South, industrial-grade infrastructure “that can provide the power, and the transmission that they need,” he said.

“We’re an attractive market from a lot of areas,” Thelen said.

Jennifer Boezwinkle, chief strategy office for Rockford Construction Co., cited how the Midwest “is increasingly being looked at as a stable location for those things to happen,” given the climate and the potential for natural disasters in other regions of the nation. She cited the hurricanes that recently hit the Southeast U.S. as an example.

“Our companies also are always looking for places to grow, and where there are going to be major investments in our economy that offer an opportunity for them to participate and be a supplier and then grow and add the market to the region.”

(economic) recovery” following the pandemic, Thelen said during a keynote address Nov. 7 for a Crain’s Grand Rapids Business Power Breakfast on commercial real estate.

“The data center industry is cer-

CRUISE

From Page 1

contract with Peterson’s company to lease a commercial dock at the city’s municipal marina for the 2025 season.

Big Blue will moor along the city’s popular riverfront walkway and nearby Chinook Pier, an area that will soon undergo redevelopment. The City Council in September selected CopperRock Construction Inc. for a project to take the place where retail shops once stood.

The city is working out a final development agreement with CopperRock Construction. In an RFP process for Chinook Pier, CopperRock submitted a proposal that envisions a multi-use market, a two-story mixed-use building with office and

ize and manufacturers produce less and have returned to a “just in time” production schedule from previous “just in case” stockpiling efforts, Thelen said. The potential for the region to become a destination for data centers offers a new opportunity for economic growth.

“As the insurance market starts to get a little rough in the South and in the West, looking to the Midwest as a great place to start any kind of business, we’re really going to see in the coming decade,”

Boezwinkle said during a panel discussion following Thelen’s presentation.

The industrial market has been slowing in the post-pandemic economy as supply chains normal-

retail that would include about 12 small shops, and a restaurant with a large outdoor seating area.

“It looks like this has a perfect synergy with that,” Peterson said.

The port of Grand Haven presently lacks a tour boat where summertime visitors can take a cruise.

Staff at the Grand Haven Area Convention & Visitors Bureau oftentimes when asked refers people up the shoreline to Muskegon, where a tour boat has operated for many years.

“We lack kind of a large vessel for charter groups,” said Marci Cisneros, executive director at the Grand Haven Area Convention & Visitors Bureau. “It’s a lovey place to enjoy the water from the shore, but so many people love to get out there.”

Grand Haven in the past was home port for a schooner that offered daily cruises and the Harbor

“Our companies also are always looking for places to grow, and where there are going to be major investments in our economy that offer an opportunity for them to participate and be a supplier and then grow and add the market to the region,” Thelen said. “One of them is data centers.”

As Crain’s Grand Rapids Business first reported last month, Microsoft is examining at least two large sites in West Michigan for potential data centers. The Redmond, Wash.-based tech giant recently acquired 272 acres of property in Dorr Township in Allegan County. That’s in addition to a 316-acre site the company bought in August in Kent County. The two sites totaling 588 acres are about

Steamer, a paddle-wheel vessel on the Grand River and Spring Lake that moored at the same city dock from which Peterson will operate Big Blue.

The vessel that Peterson acquired this summer was built in 1946 in Milwaukee for fishing charters and later was operated for several years by the Manitou Island Transit Co. that shuttles passengers from Leland to the South and North Manitou Islands in northern Lake Michigan. The vessel up until the mid-1970s also serviced the lighthouse that stands in the middle of Manitou Passage off the northwestern Lower Peninsula.

Most recently, the diesel-powered vessel was known as “Lady of the Lakes” and operated on Saginaw Bay out of Caseville in the northern Thumb Area and provided tours on Lake Huron. Peterson

12 miles apart.

In addition to those possible projects, Switch Inc. is nearing completion of a second data center building on the former Steelcase pyramid campus in Gaines Township, with plans already underway to invest hundreds of millions of dollars more for a third building.

While Microsoft buying the properties did possibly eliminate their use for future industrial development by manufacturers, Jeff Karger, executive vice president for the Grand Rapids office of commercial real estate brokerage JLL, noted during the panel discussion that the vacant land had been on the market for “many, many years.”

“Anybody that wanted to come in and develop that land had an opportunity to come in and do it,” said Karger, who is “not as concerned” about the parcels potentially going for data centers rather than manufacturing when the industrial vacancy rate in the Grand

bought the vessel in August and renamed it Big Blue, an old nickname for Lake Michigan. Peterson, who also works as a substitute math and science teacher in Grand Haven, has been refitting and repainting Big Blue, which presently sits on land at Kennan Marina along the Grand River on the city’s north side. He wants to restore Big Blue’s “classic looks” with a dark blue hull and light tan on top.

A native of Grosse Ile, located downriver from Detroit, and a lifelong boater, Peterson put in about 50 hours sanding the hull and cabin, which had been painted blue and red.

Rapids area remains low.

“As things get built up, the market will take care of the inventory,” he said.

JLL has been “doing data center after data center” for clients in markets south of Michigan, “so, seeing Microsoft come above the border and make an investment in Michigan is good for our region,” Karger said.

In a recently issued outlook, JLL noted that the West Michigan industrial market “is positioned for continued stability and growth” and had 3.6 million square feet of new space currently under construction.

“The scarcity of existing, available space will continue to limit options for tenants with upcoming lease expirations looking to expand or relocate in the near term,” according to the outlook. “Given the persistent lack of available space, average asking rents are expected to see continued upward momentum in the coming quarters.”

“It needs quite a bit of refitting,” Peterson said as he led a brief tour of Big Blue and talked about his business plans. “I’m going to work on upscaling it a little bit and make it nice.”

Peterson is still developing pricing for cruises. He’s looking at fees of $30 to $40 per person, and less for children. Private charter cruises could cost $1,200.

As he prepares Big Blue for the inaugural season next year, Peterson has been connecting with local restaurants about potential partnerships. He envisions working with restaurants to offer dinnerand-a-cruise packages to customers, or to cater a private charter cruise.

Peterson also will weigh other amenities to add to tours in the coming years.

“I have to learn my market and what my market would like to have,” he said. “I’ll get my first year underneath me and then really start dialing in to see what the customer wants.”

Randy Thelen, president and CEO of The Right Place Inc., discusses resources the economic development organization has available to developers amassing tracts of land for industrial uses. | JUSTIN rAZmUS

Randy Thelen, The Right Place President and CEO

ready to sign five-year leases yet. There is a trend of shying away from traditional leases. This is a different product in the market.”

Grand Rapids had a 14.7% office vacancy rate in the third quarter of 2024, according to the most recent quarterly office report from JLL. Despite the Grand Rapids market softening this year with negative absorption rates, it still has one of the lowest vacancy rates among U.S. cities, according to the report.

Bamboo’s proposal was discussed Nov. 12 by the Grand Rapids City Commission’s Community Development Committee. The full city commission is set to schedule two public hearings on Dec. 3 for the project. The public hearings are to consider establishing a commercial redevelop-

WOLVERINE

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record gross margins and improved net earnings.

“We are in a much, much better place than we were 15 months ago,” Hufnagel said in an exclusive interview at Wolverine World Wide’s corporate headquarters in Rockford during which he discussed the company’s three-phase turnaround plan that began with stabilizing operations.

“We’re a 141-year-old-company, and companies that are that old go through good times and bad times, and we were having a tough time in 2023, and certainly in the summer into the fall of 2023,” Hufnagel said, calling the period “probably one of the toughest chapters” in Wolverine’s history.

“The board decided to make a change and we mobilized very quickly and, I think, first and foremost, it was — not pulling any punches — to save the company,” he said.

Lately, Wolverine has focused on phase two of the turnaround plan to transform the company and looks next to drive growth.

The first phase of the turnaround a year ago involved the largest internal restructuring ever for Wolverine and stabilizing the business to “get ourselves on better footing.” The work over several months included paying down debt, reducing inventories, restructuring operations and teams, consolidating offices in Boston and London and selling a distribution center in Louisville, Ky.

The company also cut its global workforce “because the organization had just gotten too big,” and “the size of the business just could no longer support the teams,” Hufnagel said.

At the end of 2023, Wolverine had about 4,100 domestic and foreign employees in production, office and sales, according to an annual financial report to federal securities regulators. The company declined to identify how many positions were eliminated globally. In one instance, closing the Louisville distribution center in-

ment district and 12-year commercial facilities exemption certificate for the $3.1 million project.

“I met with the developers and viewed what their plans were for that building and think it’s a great use for that building,” Third Ward City Commissioner Bing Goei said during the committee meeting.

There are no environmental concerns on the property, and city staff is recommending approval of a 12-year tax exemption based on a greater than 20% commitment to using minority-, women-, or locally owned subcontractors for the construction project, said Sarah Latta Rainero, economic development director for the city of Grand Rapids.

“We don’t technically have a policy around this tool, so we’re trying to be creative and meet the needs of the applicant and the building,” Latta Rainero said

volved 150 layoffs, according to a WARN Act filing in Kentucky earlier this year.

The company also made two divestments in the last year, selling the Sperry brand in January for $130 million and the U.S. leathers business in late 2023 for $70 million.

“It didn’t take a genius to do those things because it was very much in front of us what we had to go do to save the organization, but it was just hard work to sort of pull the organization together and do,” Hufnagel said. “And then, if we did that right, we would have the opportunity to go to the next chapter, which was transform and really sort of evolve the organization to become great builders of brands.

“We would then have the privilege to inflect the growth.”

The next chapter

Hufnagel joined Wolverine World Wide in December 2008 from Under Armour Inc., where he was vice president of retail for two years. Prior to his promotion to CEO at Wolverine, he was appointed as president in May 2023 and previously served as head of the Active Group with responsibility for the Merrell, Saucony, Chaco, and Kids Group brands and global licensing.

Wolverine World Wide’s recent third quarter sales and earnings showed how the turnaround has gained traction.

While the company’s quarterly net sales declined 16.5% from a year earlier to $440.2 million, largely from the divestitures of business units, the Merrell and Sweaty Betty brands generated higher sales. Merrell’s sales increased 1.4% from a year earlier to $159.2 million, and Sweaty Betty increased 3% to $46.2 million. The Merrell and Sweaty Betty brands have now started gaining market share, Hufnagel said.

Wolverine also reduced debt from a year earlier by $373 million to $563 million at the end of the third quarter, and inventory declined by nearly 50% to $285.5 million. The company’s quarterly gross margin also improved to a

during the committee meeting.

In the coming months city staff anticipates crafting a policy around awarding the commercial redevelopment district tool, Latta Rainero added.

The 39,418-square-foot, four-story building at 2 W. Fulton St. was first listed in 2020 for $8.7 million. The building is now listed for $5.4 million by Pure Real Estate Brokerage, and the sale is currently pending.

Parking would not be included in the sale, but Bamboo is working to acquire city-owned parking spots next to the building to support day-to-day office workers, Lewan said. They have had high-level conversations with the city to acquire 50 spaces, but the number of spots has not been determined yet, she said.

Based on Bamboo’s other locations, they expect 400-500 people to be members of the coworking space, Lewan said.

Constructed in 2010, the building includes a 3,000-square-foot common space including a bar area, 1,000-square-foot art studio and 195-seat movie theater. The building was constructed to serve the unique purposes of the UICA.

Because the building was constructed for such a specific use, Bamboo will need to invest in renovating it for a new use, Lewan said. If the project comes together, it will be Bamboo’s largest location, mostly because of the event space in the building that Bamboo is planning to activate, she said.

“We’re very open to community feedback,” Lewan said. “We want to make sure we’re opening in a way that would support the community long-term.”

Bamboo also is talking to a local nonprofit to fill the anchor office space proposed in the development but has yet to officially sign an agreement, Lewan added.

Bamboo got its start more than

record of about 44.5%.

Overall, Wolverine World Wide recorded $24.3 million in net income for the third quarter, or 28 cents per diluted share. That’s nearly triple the $9 million, or 11 cents per diluted share, in the same period a year earlier.

In a recent note to clients following the company’s Nov. 7 sales and earnings report, Zacks Equity Research noted how Wolverine “continues demonstrating its ability to rejuvenate its brand portfolio through focused innovation and market adaptation.”

Reducing debt “not only improves cash flow but also minimizes the risk of markdowns and obsolete stock, enhancing overall profitability,” according to the Nov. 13 Zacks research report. Executives’ work to reduce debt also “underscores the company’s commitment to improving financial stability and reducing interest obligations, which enhances its ability to reinvest in growth areas,” Zacks said.

As well, streamlining the company’s cost structure also “reflects the success of its restructuring initiatives,” according to the Zacks report.

“These operational improvements have been instrumental in driving gross margin expansion and positioning WWW for sustained financial health. The leaner and more agile operational framework allows the company to respond quickly to market changes

a decade ago in Detroit, where it opened a coworking space in 2013, followed by locations in Royal Oak in 2021 and Ann Arbor in 2023.

Lewan, who co-founded Bamboo with Ferlito, a Detroit-based developer, told Crain’s Detroit Business in October 2023 that the company was considering Grand Rapids for a possible expansion. The company offers monthly and annual memberships and says its locations typically serve 400-500 members annually, including 200-300 businesses.

The Ferris State University board of trustees in June 2020 voted to move UICA operations to the Woodbridge N. Ferris building at 17 Pearl St. on the campus of Kendall College of Art and Design (KCAD). Ferris State officials said in spring 2020 that relocating from the space was because of negative financial effects of COVID-19 and related shutdowns.

want our brands to be more than just functional, great products. I want our brands to make consumers’ lives better and make consumers smile.”

As the turnaround progresses to the next chapter, Wolverine World Wide this month announced the opening of a new global innovation hub in Boston for design and product teams, plus an office in Zhuhai, China.

Renovations also continue at the corporation’s Rockford global headquarters for Merrell and Saucony, the company’s largest brands.

while maintaining a focus on long-term growth,” according to Zacks.

Through three quarters of 2024, Wolverine World Wide recorded $1.26 billion in sales with $26.2 million in net income, or 28 cents per diluted share.

After the better-than-expected quarterly results, the company raised guidance for the full year to $1.73 billion to $1.74 billion with 56 cents to 66 cents in diluted earnings per share. Wolverine previously expected $1.71 to $1.73 billion for all of 2024 and earnings per share of 53 cents to 63 cents.

Restructuring and stabilizing the business “was a prelude to allow us to sit here today to have the privilege to try to grow the business again,” Hufnagel said.

“The most important chapter is next,” he said.

Transformation

That next chapter will focus on raising Wolverine World Wide’s brands to new heights by producing “awesome products” that consumers embrace for their lifestyle, Hufnagel said. He described driving to build “purpose-led brands that are more than just a commodity.”

“We’re trying to build a portfolio of brands that make consumers’ lives better. This whole notion of betterment and wellness is critically important, and I want our brands to be part of the cultural conversation,” Hufnagel said. “I

Reflecting on the past 15 months at the company, Hufnagel said change will remain a constant for Wolverine to keep up with fast-changing markets.

“We’ll always be transforming the organization. If the world is moving faster than we are, we’re going to get left behind,” he said. “I think there will always be some level of transformation going forward.”

In pursuing growth, Wolverine World Wide intends to grow organically. While he doesn’t completely discount acquisitions, the company remains “very much focused on organic growth of our brands,” Hufnagel said.

The company’s priority right now is to further pay down debt and invest in existing business lines that have “great potential” to grow organically, he said.

“We really like the shape of the portfolio. We’ve divested brands and we’ve worked to invest in the brands that we currently have,” Hufnagel said. “Will we do an acquisition in the future? I’d be surprised if we didn’t someday, but not in the near term. I don’t see it happening.”

Now in his second year as president and CEO, Hufnagel has made it one of his goals “to deepen the connections to the community” for the home-grown Wolverine.

“We love calling West Michigan home. We are a part a part of the community,” he said. “All of the different chapters of our company, both the good years and the bad years, we’re very, very committed to West Michigan.”

Wolverine World Wide acquired women’s activewear brand Sweaty Betty in 2021. As part of the recent turnaround strategy, the brand grew its sales by 3% to $46.2 million in the third quarter. | CoURTESY PHoTo

reimburse an affiliate of Westwind Construction up to $6.4 million in eligible expenses over 15 years.

The developers planned to allocate 43, or 20%, of the planned 216 units to households earning 95% or less of area median income. That’s about $78,185 for a two-person household in Ottawa County, per the latest U.S. Department of Housing and Urban Development guidelines.

Coopersville City Manager Dennis Luce said via email that the project “would have been the most substantial investment” in multifamily housing the city of approximately 4,800 people has ever seen.

But the finance committee voted against advancing the plan to the full county board for a vote.

County commissioners Joe Moss, Rebekah Curran and Kendra Wenzel voted no, and Roger Belknap voted yes. Commissioner Gretchen Cosby was absent. All five committee members were at one point backed by the far-right Ottawa Impact group that is set to lose its majority on the Ottawa County Board of Commissioners following the Nov. 5 election. Cur-

ran reportedly distanced herself from the group and decided against seeking reelection earlier this year, while Belknap is in a “lame duck” position after losing his reelection bid in the August primary.

Moss, Ottawa Impact founder, cited what he called an “outpouring” of public opposition to the Coopersville project as one reason for blocking it.

A local certified public accountant named Joel Spoelman whose business is across the street from

“I don’t think it’s wise to give developers taxpayer dollars, and I’m against TIFs in general.”

Joe Moss, Ottawa County commissioner

the proposed development site mobilized a group of about 285 individuals to sign a petition opposing the tax incentives and sent it to the finance committee ahead of the meeting.

“We just want them to pay their taxes,” Spoelman said when invited by Moss to speak at the committee meeting, though there was no public hearing scheduled on the motion.

In addition, the Coopersville Observer recently printed a letter to the editor opposing the project that contained so much misinformation about brownfield TIF incentives that the city of Coopersville posted a 3,500-word response on its public Facebook page to correct 15 factual errors it said had since been circulating on social media and stoking opposition to the project.

Moss also cited his own ideological issues with tax incentives as a reason for denying the brownfield plan. That’s despite the finance committee unanimously approving similar brownfield TIF plans for three other projects in June and July this year, sending them to the full board for a final vote with little fanfare.

“I don’t think it’s wise to give developers taxpayer dollars, and I’m against TIFs in general,” Moss said during the Nov. 8 committee meeting. “The outpouring of community voices definitely matters to me. It is a conservative position to oppose giving taxpayer dollars to private companies. It’s also a Republican position, so it’s actually very easy for me to take.”

Moss said he was unavailable for an interview for this story, re-

“ensure all of our customers have access to the products they need in the cleanest shopping environment possible.”

to go home,” Keyes said. “That’s really grown since the pandemic and it keeps growing.”

While the retailer is finding growth opportunities with its smaller stores, Keyes remains uncertain if Meijer will return to its former 24-hour operating model.

The company reduced its store hours in early 2020 in response to the COVID-19 pandemic, closing the stores overnight for cleaning and restocking.

At the time, Keyes stated that the adjusted store hours would help

In the years after the pandemic, the store has yet to return to its 24hour format, with Grand Rapids stores open from 6 a.m. to midnight.

Keyes said that Meijer continues to evaluate a return to its former hours, but “really have not decided to reopen 24 hours yet.”

Meijer operates more than 500 supercenters, grocery stores, neighborhood markets, and express locations throughout the Midwest in Michigan, Illinois, Ohio, Wisconsin, Kentucky. Forbes ranked Meijer 16th on its list of largest private

been largely vacant ever since.

want to be part of that,” Kessel said. “Our downtown is a great place to work. That’s part of this — to be able to make purchases downtown, to dine downtown, to have business meetings and all that.”

Independent Bank’s corporate headquarters will remain on East Beltline Avenue.

Built in 1910, the Ottawa Avenue office building initially housed Kent State Bank, which later reorganized as Grand Rapids Industrial Bank. The building most recently was home to RDV’s philanthropy team that relocated in 2021 to 200 Monroe Avenue. The building has

RDV, the DeVos family office, leased space at 98 Ottawa for several years starting in 1993, bought the building in 2009, and finished a significant renovation in 2010.

“98 Ottawa has a tremendous

companies with $21 billion in sales and 70,000 employees.

Locally, the retailer has invested in renovating its Grand Rapids-area stores over the past several years, most recently wrapping up a remodel of its 28th Street and Kalamazoo Avenue location last month.

The renovations included a new store layout, moving the dairy and frozen foods sections to be adjacent to the grocery department, new fixtures and the expansion of the pets and alcohol sections.

“We’re a generational, family-run business, and we really run our company for the next generation as we think about growth,” Keyes said. “West Michigan is an

history, including as the home of DeVos Family philanthropy staff for nearly two decades. In its initial years, the building served locals as a bank and was the location where a young Rich DeVos secured his first business loan,” an RDV spokesperson wrote in an email to Crain’s Grand Rapids Business. “It will be exciting to see this historic structure’s next chapter unfold.”

Independent Bank (NASDAQ: IBCP) has 58 offices in 25 counties of the Lower Peninsula with $5.25 billion in total assets and $462 billion in total deposits at the end of the third quarter. Loans totaled $3.94 billion.

The corporation last month reported $13.8 million in net income for the third quarter, or 65 cents per diluted

ferring Crain’s to his comments during the Nov. 8 meeting.

Roman Wilson, vice president and brownfield program manager for Cascade Township-based Fishbeck, which worked on the brownfield TIF application for Westwind, noted that Michigan’s brownfield law has operated since 1996 under both Republican and Democratic administrations.

Wilson added that the brownfield TIF program was expanded to include support for workforce housing development last year.

“Originally, it was based on brownfields in the sense of contamination. As time has gone on, we’ve (added) functional obsolescence, blight, land bank-owned property, historic resources and now housing property,” he said.

“... It’s proven … and it’s not about padding a developer’s pocket. It’s covering the gap only for what is necessary, for the window of time that is needed.”

Tax increment financing allows local authorities to capture the difference between pre- and post-development property taxes to reimburse developers for eligible activities for a certain number of years, provided a brownfield plan has been approved.

The property in question currently generates $10,800 in annual

important market for us, and we believe our customers deserve a great place to shop.”

As well, Meijer recently closed on the $7.35 million purchase of a 130,000-square-foot office building and surrounding property at 1700 28th St. SE that formerly housed the Christian Reformed Church in North America headquarters. Meijer plans to demolish the building, replacing it with a gas station, which will relocate from an adjacent property on Kalamazoo Avenue.

The gas station would occupy a portion of the 11-acre former CRC parcel, leaving the rest open to additional development.

While Keyes did not elaborate on

share. Nine-month net income totaled $48.3 million, or $2.29 per diluted share. The bank’s commercial loan portfolio grew by $145 million in the quarter to $1.82 billion for an 11.5% annualized growth rate. The growth came “despite significant headwinds from unscheduled payoffs in the second quarter,” Joel Rahn, Independent Bank’s executive vice president for commercial banking, said during an October conference

state and local taxes on a taxable value of $182,710. It would generate about $860,000 on a taxable value of $12 million post-development, according to Fishbeck. Ottawa County Brownfield Redevelopment Authority Chair Josh Brugger said in the meeting that Westwind’s brownfield application “checks every single box” and followed the template of the other brownfield TIF plans that were approved by the county this year. These include Veneklasen Construction’s 141-unit Terra Station project in Spring Lake and 41-unit Winsor Place development in Spring Lake, as well as Moxie Real Estate’s 41-unit Prospect Flats plan in Hudsonville. Next steps for the Coopersville project are now unclear.

Oleszczuk told Crain’s that the firm sees little precedent for how to move forward after a denial, given how recently the brownfield law was expanded to include housing.

“I don’t think the situation really exists, so to say I’ve got a pathway either way would be foolhardy, because we’re still trying to understand, one, the original process as we navigate it, and two, now that it’s been derailed for a reason that is beyond our logic, what is the next step?” he said.

further development plans for the corner property, he noted that the company’s focus is “just to put up a great Meijer Express station.”

The new 24-hour gas station and convenience store would span approximately 3 acres with 22 parking spaces, four electric vehicle charging stations and seven fuel dispensers that could accommodate up to 14 vehicles, according to site plans. The 5,600-square-foot convenience store would sell alcohol and include a food preparation area and indoor seating.

“I think it really enhances that corner,” Keyes said, noting that “to move out to that primary corner is going to be great.”

call with brokerage analysts to discuss quarterly results.

“Based upon a solid commercial pipeline, we see continued growth opportunity in the fourth quarter while maintaining our disciplined credit standards,” Rahn said.

In the recent FDIC summary of Deposits for 2024, Independent Bank ranked ninth out of 103 banks operating in Michigan in terms of deposit market share. The bank recently opened a new branch in Macomb County’s Clinton Township.

M&A market gains more certainty with presidential election in the rearview mirror

M&A professionals during the year have cited three issues that have weighed on deal flow: High interest rates, inflation and uncertainty about the direction of the economy, and the presidential election. Interest rates now are on their way down, inflation has moderated, and the election is over, with Donald Trump winning a decisive victory and second term in office. Justin Pinto, vice president at Grand Rapids M&A firm and investment bank Charter Capital Partners, recently wrote an analysis on how presidential election cycles affect the M&A market. His conclusion: Elections do introduce uncertainty into M&A strategies, and usher in new policies by the winner, although “M&A activity during election years is largely influenced by broader macroeconomic cycles rather than by the election cycle itself.” He recently spoke with Crain’s to go into greater depth about his findings. | By

What’s your basic conclusion about how election cycles affect the M&A market?

Through the research that I’ve done with a variety of sources, publications, internal databases that we utilize here at Charter, ultimately it remains somewhat unchanged. All of the speculation in conversations and discussions that are going on really resulted in no volume or value change within a four-year presidential period. There are occasional blips or downfalls here that can be affected, but in reality, the amount of dry powder sitting on the sidelines is at a record high. A lot of these private equity groups are approaching their traditional hold period. What I’ve seen in the research tool is that once that cycle starts again, those larger private equity firms exit some of the holdings that they’ve had, they return capital to the LPs, the LPs then obviously have to restart their sourcing, investing and holding period. So, ultimately it comes back.

Over the last number of quarters and throughout this year, I’ve heard a number of people say buyers and sellers were waiting to get through the uncertainty of the presidential election. Is that more of a myth or reality?

It’s a little bit of both, I would say. We can see by the overall deal value and volume count, toward the end of 2023 and in the first two quarters into ’24, we did experience a little bit of softness across the broader market. With where we’re at and kind of a holding cycle and capital on the sideline and the elections past us, I think we’ll see some more activity towards the end of this year leading into 2025.

Also, the federal funds rate had a 25-basis-point decrease (on Nov. 7), and I think it will continue to spur that excitement across the market.

Were things like interest rates and the broader economy bigger factors than the election?

I would say that, generally, we see more of the macroeconomic factors impact M&A activity than we do presidential election cycles. All of the factors combined certainly cause a little bit of pause

Mark Sanchez

for investors as they wait to see how things play out.

What is it about an election cycle that would cause some people to feel uncertain?

Policy is a big piece of that. The last four years, and even back to 2016 regarding corporate tax changes, (when there were) some pretty large and drastic changes from the corporate side, and potential changes to tariffs certainly impact trade. Being here in the Midwest, West Michigan specifically, there are a lot of folks across this geography that feed into a lot of the broader marketplaces. All of the tax components, the tariffs, other policy changes, wages and employment components certainly can have an impact on each individual business.

Now that the election is over, interest rates are coming down and are expected to continue coming down into 2025, inflation seems to be under control, what’s the mood?

I’d say it’s optimistic to a certain degree. ‘Cautiously’ is still a word that we’re hearing, but folks are more optimistic about ‘25 than ‘24. There’s a little bit more certainty. Inflation is under control, interest rates are continuing to come down, the president’s been named. Folks are, I would say, able to approach the market with greater comfort than they might have in ‘24.

If a seller were to call you and ask for advice on whether or when to come to market, what would you tell them?

There’s never a good time to play the market. So, I say now is the best time. M&A transactions generally take time and a lot of strategy and positioning. The earlier that you’re able to start to map out a pretty clear strategy to make sure that the shareholder objectives are met, it is a good time.

Part of what we saw in ‘23 and ‘24 is the valuation gaps between buyers and sellers. That’s since been bridged as we see interest rates come down. You’ll have a little bit more of a competitive marketplace.

Do you see a seller’s market or a buyer’s market?

It’s definitely a seller’s market coming into ‘25. We’ve had a lot of shareholders that have been sitting out the last four years, and a lot of that was driven by some of the uncertainty from the broader macro-economic and geopolitical concerns that they might have had. I think there’s going to be more of an inflow of sellers to the marketplace in ‘25.

What do you see as hot sectors these days?

Buyers these days, their appetite has certainly shifted. Business services and distribution are certainly going to be industries that folks are going to be interested in. Health care

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technology certainly will feed into that as well. Primarily being based here in West Michigan, the types of deals that we’re seeing and shareholders and owners that we’re working with cover more of an industrial/distribution manufacturing space.

Buyers these days are looking for businesses that have had steady growth, both through COVID and post-COVID, and are continuing to reach some tailwinds in those respective industries, but also are looking to back management teams. They don’t want to come in and operate the business per se but want to back management over a period of time to help take them to that next step and are looking for businesses that have a nice cash-flow profile.

There’s a line in your report about how “the factors driving M&A activity now may differ from those of previous election cycles.” How do they differ this time?

We’ve seen both of these presidencies before, with Donald Trump having been in the office previously. A lot of the business community understands his positions and some of his policies, and I don’t believe there will be any drastic changes compared to his previous presidential cycle. I think the business community, shareholders and owners will find more comfort that there won’t be dramatic changes.

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