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Monday, January 27, 2014 — 9A
Extra payments from 2 ‘U’ to A could receive further consideration
A R T O F TA I - C H I
City officials say ‘U’ land purchases decrease municipal tax revenue By EMMA KERR Daily Staff Reporter
LILY ANGELL/Daily
Master Wasentha Young, a paractitioner of the martial art of tai-chi since 1969, led a workshop at the 2014 Asian American Health Fair in the Medical Science Building II on Saturday.
‘U’ research cluster gets low rank in producing start-ups, patented tech Research alliance noted for talent production, research spending By ALICIA ADAMCZYK Deputy Magazine Editor
With recent entrepreneurship-focused events like the startup career fair and MHacks fresh in the minds of many students, it might seem that student-created tech and business ventures are everywhere at the University. But a recent report conducted by East Lansing-based Anderson Economic Group found that the University Research Corridor, a research alliance between the University, Michigan State University and Wayne State University, may need to place more emphasis on entrepreneurship for the URC to remain competitive with the seven other major university research clusters ranked in the study. According to the study, which was conducted over a five-year period that ended in 2012, though the URC granted more degrees than any of the other clusters, it placed last in tech transfer and next-to-last in launching startups. The University was responsible for 11 of the 14 startups created in the URC during the study’s five-year period, while MSU was responsible for the other three. However, the URC had a strong showing in other categories against the other clusters, which included North Carolina’s Research Triangle Park, California’s two Innovation Hubs and Massachusetts’ Route 128 Corridor. In fact, the URC placed first in talent production and fourth in research and development spending. What the University may lack in startup quantity, it makes up for in quality, according Tom Frank, the executive director of the University’s Center for
COST From Page 2A of the Board of Regents, said the search was more intense and more involved than any of the previous two presidential searches that she participated in. However, she said this was the first search in which the regents were involved in the entirety of the search, rather than simply voting from a selection of finalists presented by the search committee. Since the regents decided to participate in the whole search process this time around, Newman said the search committee was confined to faculty to prevent the group from becoming too large. Multiple forums were held in September and October and many students and faculty spoke before members of the search committee about what they hoped to see in the next president. LSA freshman Benjamin Cher spoke at the Sept. 27 forum about the need for a new president to
Entrepreneurship. He added that when it comes to talent, the University can’t be beat. Frank cited Rapt.fm, which encourages freestyle rap and one-on-one rap battles with people from all over the world, and A2B Bike Share as examples of the high-caliber startups created by University students. “One of the reasons I came here from California is because I’ve never seen this confluence of factors that make Michigan feel like it’s just ripped wideopen in terms of output of scalable, viable businesses,” Frank said of the combination of resources available and student talent. The startups indicative of the success of the creators, in addition to employing other students and picking up venture capital and other external funding. These factors, combined with the “cutting edge” programs being developed by administrators, indicate that University students will continue to be at the top of the business heap, according to Frank. “Long-term viability is ultimately what’s going to add the greatest value to the Michigan ecosystem and create jobs here and sustainability,” Frank said. “It’s not always important to say I had 25 contestants that entered the marathon; I’d like to have the top five finishers.” Ken Nisbet, associate vice president for research at the University’s Technology Transfer Office, said the URC report was less indicative of the University’s overall standing than it was of the need to continue to improve resources in the state of Michigan. While the University receives the most research funding of any institution in the state, part of the URC mission is to engender communication between the three coordinating units and to share the best practices and talent resources to improve the economy in the region.
“We have a number of success stories out of the University of Michigan startups that are known nationally,” Nisbet said. “We are definitely not underperforming relative to those other states.” According to a 2013 survey, URC alumni “had started or acquired businesses at double the national average rate among college graduates since 1996 and were 1.5 times as successful as the average U.S. business owner at keeping those startups and acquisitions alive in the previous five years.” Still, there’s room for improvement. Engineering junior Christopher O’Neil, president of MPowered — a student organization that fosters entrepreneurship within the campus community — said the University could work on increasing its interdisciplinary approach to startup creation in order to maximize student potential. O’Neil said it would be beneficial if the University offered more project-based undergraduate classes that mix Business, Engineering and Art & Design students who are all focused on creating something together. “One of the problems with Michigan is that it’s super decentralized,” O’Neil said. “I think it’d be a lot easier for people to start companies if they didn’t have to go search for the designer, search for the engineer, search for the business student.” He added that the University is on an “upward slope of entrepreneurship,” and will continue to improve its resources and programs for students interested in starting their own companies. O’Neil said the best is yet to come from University students. “Even in the time I’ve been here, I can say 100-percent that the culture and mindset has changed at this University. The mindset is there. Now we just need to churn out some better startups.”
allocate resources to various departments more efficiently, though he said he was appreciative of the opportunity given to him. “There were some speakers at the forum who went up to the microphone and said ‘I do not wish to thank you for the right to speak because I know I have the right to speak and I should expect this’ — and I think that’s the wrong attitude,” Cher said in a Friday interview. “I am grateful for the fact that this exists and that someone like me is able to express their opinion.” Without a student on the search committee, CSG posed a six-question survey to students in midSeptember to garner a sense of what students hoped to see in the president. “We might have incidentally set a new precedent throughout presidential searches,” Proppe said. “We were able to collect feedback from hundreds of students, actually about a thousand students about what the students wanted in the next president.”
In an interview Sunday, Schlissel outlined the chronology of the search process, which for him began in October and lasted through much of the fall. Schlissel first met the search committee in New York City, where he sat at the head of a long wooden table and answered questions from the regents and committee members. “After a few minutes, it stopped being an interview and felt like a conversation between colleagues,” Schlissel said. The second meeting also occurred in New York City, where Schlissel met with small subgroups of search committee members. After the second interview, Schlissel made his first visit to Ann Arbor in late November where he toured campus before having dinner that evening at Regent Denise Ilitch’s home. “It was very conversational. They were probing the way I thought about various issues,” Schlissel said.
With a new Ann Arbor mayor and University president set to take office within the next year, discussion will likely be sparked by a major facet of the University and Ann Arbor: land. As the University buys up properties and takes them off the tax rolls, some city officials argue that the University should offset some of the property taxes lost due to the school’s public status. While the adoption of a PILOT — or payment in lieu of taxes program — never gained substantial traction, with the appointment of a new University president and the approaching election of a new city mayor, discussion of such a program might not be too far off. With the adoption of a PILOT program, the University would siphon funds to the city to make up for lost tax revenue. Jim Kosteva, the University’s director of community relations, cautioned against the measure — one that has yet to be formally proposed by any of the members of the Ann Arbor City Council. “Students do not give the University of Michigan their tuition dollars and taxpayers from across the state do not give the University of Michigan their tax dollars just so we can turn that money over to the city of Ann Arbor so that they can fix their pot holes,” Kosteva said. Kosteva also said for students living off campus — a
large proportion of the student population — giving part of their tuition to the city while they are already paying their own property taxes through rent payments seems unfair. Two other concerns surrounding the implementation of such a program are that its revenue potential can be limited and unreliable, and that it could force the University to raise tuition, cut services or reduce employment to compensate for the potentially millions of dollars this program would drain from the University. Councilmember Christopher Taylor (D–Ward 3) said he supports a PILOT program in Ann Arbor and thinks it would be in the best interest of students and Ann Arbor citizens alike. “I believe that the city should do all it can to preserve its tax base,” Taylor said. “As to a PILOT, I would love to see the University provide a payment in lieu of taxes to the city of Ann Arbor, other universities throughout the country do so, and it strikes me as appropriate and reasonable.” Councilmember Stephen Kunselman (D–Ward 3) said the University’s expansion will be the key issue in city-University relations over the next few years. He said he is looking forward to new efforts of collaboration between the city and the University as well as a serious discussion of the PILOT program or other potential solutions for the ever-expanding University. “The problem with that whole effort is that the state institution is for the public good — but what are we really dealing with?” Kunselman said. “We’re dealing with U of M athletics. How is U of M athletics a public good? It’s part of the University of Michigan but it is also a huge enterprise. That’s where I think it starts
making it a different issue. I think that’s when it certainly needs to be discussed.” However, some council members doubt the possibility of a PILOT program ever being instituted. City Councilmember Sally Hart Petersen (D–Ward 2) said the program is not practical. “In order for the University and the city to work collaboratively, we need to begin working more outside of the box, while others argue that not wanting to act in a way that — to some city council members — is responsible demonstrates a lack of concern for the University,” Petersen said. “However, both city and University officials have said that they share similar interests in the city.” Michigan State University has an agreement with the city of East Lansing that does not include any form of reimbursement of taxes, and at this time a PILOT program is not under consideration. However, Yale University recently increased its PILOT payments to the city of New Haven from $1.2 million to $7.5 million. A study by the Lincoln Institute of Land Policy found that though such programs can provide much-needed revenue for cities and towns, the downsides are also numerous. “PILOTs can provide crucial revenue for certain municipalities, and are one way to make nonprofits pay for the public services they consume,” the report stated. “However, PILOTs are often haphazard, secretive, and calculated in an ad hoc manner that results in widely varying payments among similar nonprofits. In addition, a municipality’s attempt to collect PILOTs can prompt a battle with nonprofits and lead to years of contentious, costly and unproductive litigation.”
MUSIC Matters revamps end-of-year concert to include more student orgs. Besides headline artists, SpringFest to expand reach By MICHAEL SUGERMAN Daily Staff Reporter
MUSIC Matters’ year-end SpringFest event began as an annual celebration capped by a concert featuring a headlining artist. At its inception, the money it raised would go to a charity, set to change each year. After two years, the student organization is expanding its vision. In November, the group unveiled its $50,000-endowed “Big Thinkers” scholarship, the first student-funded endeavor of its kind at the University. Now, MUSIC Matters is revamping SpringFest to resemble South by Southwest, a nine-day spring festival in Austin, Texas that is a hub for music, film and technology. SpringFest will occur on either April 10 or 17, LSA senior Phillip Schermer, president of MUSIC Matters, said. On Sunday, leaders from MUSIC Matters pitched SpringFest’s new structure to student organizations potentially interested in being involved in its set up. “At the end of the day, MUSIC Matters is coordinating this event, but it’s really supposed to be by the community and for the community,” Schermer said. The new SpringFest may expand to envelop a large portion of Central Campus.
The tentative structure features what Schermer calls the “globe,” an open area and stage featuring food and speakers throughout the day. Sprouting from the globe will be spaces organized by five themes: arts, identity, innovation, social justice and sustainability. Organizations will display their year’s work within the corresponding theme. Schermer said he wants the event to showcase students’ accomplishments. To provide examples of what the typical organization will do to exhibit its work, SpringFest’s anchor groups — optiMize, MPowered, Michigan Sports Business Conference, the National Pan-Hellenic Council and Ask Big Questions — presented their plans. Representatives from optiMize, a student organization centered on entrepreneurial social service, expressed their hope to partner with student artists and create artistic social commentary relating to the group’s work. Students from MPowered said they want to host professionals to judge student startups and integrate them into the marketplace. Kinesiology senior Jared Hunter, president of Michigan’s National Pan-Hellenic Council, said SpringFest could facilitate a stepping contest between fraternities and sororities judged by administrators. Each of the NPHC’s organizations has an auxiliary youth chapter, allowing area high school students to attend SpringFest.
This concept aligns with MUSIC Matter’s partnership with the Office of Admissions, which sees SpringFest as an opportunity to showcase the University. Business junior Nick Moeller, chair of the SpringFest Committee for MUSIC Matters, said the University’s and MUSIC Matter’s goals are aligned. “A big part of what we stand for as an organization is bringing Michigan students together,” he said. “SpringFest is something that you don’t see on other campuses, and the idea (was) that the University might be able to promote that as, ‘Look at what you can do at the University of Michigan. If you’re a part of any organization from any background, you can come be celebrated and we can showcase the work you can do.’” LSA senior JoHanna Rothseid, president of Ask Big Questions, hopes her organization will kindle this kind of intermingling. The organization intends to place whiteboards between each section of student organizations at SpringFest — where facilitators can foster conversation and written responses related to the specific section’s theme. “We spend so much time going to this University and getting so involved and invested in our extracurriculars,” Rothseid said, adding that the whiteboards would allow space for conversation that addresses the “awesome and incredible things” students are doing across numerous fields.