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20160229-NEWS--0001-NAT-CCI-CD_-- 2/26/2016 5:48 PM Page 1 After a winding road to development, work expected to start on new downtown building, PAGE 3 FEBRUARY 29-MARCH 6, 2016 Were pension fund Who gave what? Crain’s searched federal records to find out who some of the state’s business and government leaders have warnings missed? backed for president. The results reflect a sampling of $2,700 individual contributions. More donors on Page 25. Michigan donors gave more than $5 million to candidates By Robert Snell signs of revitalization in Detroit. A through January, months before the March 8 primary. [email protected] recession or poor market perform- All Candidates $5,411,523 Paul (R)* $198,289 Mayor Mike Duggan’s revelation ance by the city’s two pension funds Republicans $3,689,330 Fiorina (R)* $101,639 that the city faces a $491 million could even mean Detroit would be pension fund shortfall shocked forced to pay more than $491 mil- Democrats $1,718,804 O’Malley (D)* $31,131 legal experts and city officials who lion starting in 2024. Clinton (D) $1,174,906 Trump (R) $27,067 thought Detroit had left budget- “If there is a change in the market Dan Gilbert Richard DeVos Sr. Bush (R)* $998,093 Christie (R)* $24,075 busting problems behind in bank- ... going forward, it could have an Carson (R) $862,147 Graham (R)* $21,635 $500,000 + $750,000 $250,000 ruptcy court. impact on how large the deficit is in Rubio (R) $618,459 Jindal (R)* $11,300 Interviews and court records, 2024,” Detroit’s CFO John Hill said. America Leads, Right to Rise USA, however, offer insight into what The city’s bankruptcy plan, final- pro-Chris Christie pro-Jeb Bush Cruz (R) $508,109 Huckabee (R)* $8,179 might have caused a half billion-dol- ized in 2014, always prescribed a super PAC super PAC Sanders (D) $504,517 Santorum (R)* $2,367 lar threat to Detroit’s budget and re- balloon payment in eight years. $100,000 $250,000 Kasich (R) $235,787 Pataki (R)* $500 veal missed warning signs during the That payment was expected to be New Day for America, Conservative Solutions, * Suspended their campaigns frantic pace of the largest municipal $111 million. pro-John Kasich pro-Marco Rubio bankruptcy case in U.S. history. The city’s bankruptcy plan calcu- super PAC super PAC Duggan said the $491 million lated the payment after projecting shortfall is not yet a crisis for De- the life expectancy of city retirees troit, which shed about $7 billion in based on old mortality tables, from debt during the bankruptcy. That’s the year 2000, according to the De- because the city has a projected $30 troit Financial Review Commission. million surplus this fiscal year — “They assumed people were not money that will be used in the short going to live as long as they would,” term to help fill the pension gap. Duggan said during the Feb. 23 But the shortfall has emerged State of the City address. Tom Gores Peter Karmanos Jr. Roger Penske David Cotton during a national economic recov- Duggan did not identify which ery that may be peaking and amid SEE PENSIONS, PAGE 24 $2,700 $2,700 $2,700 $2,700 Hillary Clinton Marco Rubio Jeb Bush John Kasich OldOldmoney,money,newnewdirectiondirection State’s major givers target candidates in changing presidential field By Lindsay VanHulle DeVos, Meijer, Schuette and Schostak — Crain’s Detroit Business/Bridge Magazine back now? LANSING — Michigan loves Jeb Bush. “With him getting out, it just kind of shows Until recently, the former Florida governor that there are a lot of different people who are was the top fundraiser of all presidential candi- important players in GOP politics up for grabs,” 2015 M&A — a huge deal dates in the state, regardless of political party, ac- said Craig Mauger, executive director of the Michi- cording to campaign finance records released by gan Campaign Finance Network. We’ve been tracking big deals for years. And 2015 was the biggest. the Federal Election Commission. “It’s almost like they’re trying to put their chips Crain’s found 138 deals in Michigan last year worth at least $10 million, But Bush, trailing in early primaries, suspend- on different people,” said Mauger, adding that and those deals added up to $101.5 billion. ed his campaign more than a week ago after re- U.S. Sen. Marco Rubio of Florida and Ohio Gov. sults were tallied in South Carolina, despite rais- John Kasich could be likely contenders. That figure was buoyed by the biggest deal in Michigan history — Dow ing and spending millions in his bid to be third in Some backers, indeed, have donated to sever- Chemical Co.’s $65.6 billion merger with fellow chemical competitor his family to win the White House. And in Janu- al candidates in hopes that one will emerge as DuPont. ary, Democratic candidate Hillary Clinton sur- the candidate in a large Republican primary. But the rest of the deals were frequent — and diverse. Food, technology, passed him as Michigan’s overall fundraising The billionaire DeVos family of West Michigan, health care, automotive — all are highlighted beginning on Page 9. leader. long influential in Republican politics, has cho- Which raises the question: Who will Bush’s sen to endorse Rubio now that the field has nar- biggest Michigan supporters — with names like SEE DONORS, PAGE 25 © Entire contents copyright 2016 by Crain Communications Inc. All rights reserved. crainsdetroit.com Vol. 32 No 9 $2 a copy. $59 a year. Merging of the Minds We make M&A manageable NEWSPAPER 20160229-NEWS--0002-NAT-CCI-CD_-- 2/26/2016 3:59 PM Page 1 2 CRAIN’S DETROIT BUSINESS // FEBRUARY 29, 2016 payments,” said Dave Hurst, direc- Francisco-based ride-hailing MICHIGAN tor of market analysis for Detroit- company defended its screening INSIDE based NextEnergy. “With policy up of drivers, saying it couldn’t have THIS ISSUE in the air at the moment, it’s hard to predicted that driver Jason Dal- BANKRUPTCIES . 7 CALENDAR . 20 see a strong incentive for invest- ton would engage in the random CLASSIFIED ADS . 21 ment. These markets don’t like tur- shootings that left six people DEALS & DETAILS . 19 bulence, and Michigan is certainly dead in Kalamazoo Feb. 20, AP re- MARY KRAMER . 6 BRIEFS setting the stage for turbulence in ported. Uber said its safety proce- OPINION . 6 the next couple of years.” dures don’t need to change. But PEOPLE . 20 Senators reach deal on Flint that they think could have helped Comprehensive energy propos- some experts say the company RUMBLINGS . 27 water crisis,but vote delayed prevent the public health crisis in als in the state House and Senate must take a harder look at poten- WEEK ON THE WEB . 27 Flint, AP reported. Sponsors of a bill include changes that would reim- tial drivers if it wants to convince Senators from both parties in package that would restore com- burse generators for excess electric- riders the service is safe, even as Washington reached a tentative missions to oversee the Department ity at wholesale, rather than retail, they agreed that Dalton wouldn’t COMPANY INDEX: $220 million deal to address the of Environmental Quality said during rates. A similar change in Nevada have raised red flags because he SEE PAGE 25 water crisis in Flint and allow a a news conference that the com- reportedly drove several large in- didn’t have a criminal record. long-stalled energy bill to move for- missions would help curtail future stallation businesses — and hun- Ⅲ The Grand Rapids-Wyoming gan Strategic Fund, a division of the ward, although presidential candi- lead-contamination crises. dreds of jobs — out of the state. market ranks No. 16 in a ranking of Michigan Economic Development Corp. date Ted Cruz and other Republi- the “Best & Worst Cities for Women- The one-year contract includes four can senators initially held up the Report: Solar industry MICH-CELLANEOUS Owned Businesses” by WalletHub, annual renewal options. legislation last week, The Associat- outlook to improve in state the Grand Rapids Business Journal Ⅲ The historic Capitol Theater in ed Press reported. Ⅲ Dow Chemical said it will pay reported. The analysts compared downtown Flint is inching its way A proposal by Sen. Debbie A recent solar jobs report says $835 million to settle a long-stand- the top 100 metro statistical areas in toward renovation after getting $5.5 Stabenow, D-Mich., and Sen. James Michigan stands to boost industry ing class-action lawsuit, after the 10 metric areas. Nashville, Tenn., million from the Michigan Strategic Inhofe, R-Okla., would authorize employment by 14 percent this death of Justice Antonin Scalia de- ranked No. 1; Detroit was 46th. Fund, MLive.com reported. The $100 million in emergency aid to fix year, but those in the sector say the creased its chances of prevailing at Ⅲ The state’s Pure Michigan project includes an 1,800-seat the- and replace Flint’s lead-contami- long-term outlook is much more the U.S. Supreme Court, AP reported. tourism website is getting an over- ater with 21,000-square feet of of- nated pipes and $70 million in uncertain, Midwest Energy News re- The Midland-based company was haul — with help from a Florida- fice space. The project also will get a loans to improve its water infra- ported. found liable in 2013 by a Kansas based marketing company. Miles $500,000 grant from the Michigan structure. The deal also authorizes Smaller, distributed projects jury of allegedly conspiring to fix Media Group LLP, based in Sarasota, State Housing Development Authority $50 million nationwide to bolster have largely fueled Michigan’s solar prices for polyurethane, an indus- Fla., won a $389,690 contract to re- and an expected $3.7 million feder- lead-prevention programs and im- growth, though analysts project the trial chemical used in everything build Michigan.org from the Michi- al Historic Tax Equity.