Blue Cross Blue Shield launches new product for companies with out-of-state employees, Page 3 SEPTEMBER 5 - 11, 2016 Small-biz leaders: Brain drain, state tax income are on the line Policy changes weighed as some biz owners cash out By Lindsay VanHulle Crain’s Detroit Business/Bridge Magazine About the bill LANSING — e scenario: A State Sen. Wayne Schmidt small-business owner in Michigan, (pictured), R-Traverse City, in April close to but not necessarily at retire- introduced Senate Bill 893, which ment age, meets with a nancial ad- would viser to consider selling the compa- deduct from ny. He decides to move to Florida the state’s — in part for the climate and in part income tax because the Sunshine State has no RENDERINGS COURTESY THE KINGSLEY INN “income income tax — and buy a condo with An artist’s rendering of the Doubletree by Hilton Bloomeld-Detroit, currently the Kingsley Inn, shows the updated hotel. received from the tax savings. the sale of a Rob Fowler calls them cashed-out business that entrepreneurs. is reinvested And he says he has seen it happen within that A landmark monarch three times in roughly eight years, by same tax former members of the board of the year into another business that Small Business Association of Michi- does business in this state.” The gan, of which he is president and exemption would apply to tax years gets a new moniker CEO. beginning aer Dec. 31, 2015. “ey sold their business, which is always a happy thing,” Fowler said. The bill has been referred to the Kingsley Inn owners plan renovation this fall “What’s unhappy about it is out of Senate’s banking and nancial Rob Fowler: Michigan goes the combination of institutions committee. Schmidt By Sherri Welch year and a half after buying it, to ex- Explainer type for their money — born and raised here said he hopes it gets a hearing this [email protected] plore the interest they were getting three lines — (and) their experience. And, you fall. e owners of a local landmark ho- from buyers around the country. But know, lots and lots of cashed-out en- tel, the Kingsley Inn in Bloomeld then they had a change of heart. trepreneurs invest in other business- Hills, have a new ag, look and restau- Elia and Shiman are also partners es, but not if they’re not around to Livingston, Midland and Missaukee rant in the works for the site long in 800 Parc LLC, the operator of the watch their investment.” — had net business gains. known as a meetup spot in the tony restaurants at Detroit’s Campus Marti- e issue, he said, is the Wayne County’s 29,982 business- suburbs. us. “low-hanging fruit” confronting his es are 9.2 percent fewer than in 2006. e Kingsley name will come down “At the end of the day,” Elia said, “we association’s board as it looks deeper Oakland and Macomb counties lost when the hotel hoists the Doubletree decided a long-term investment in the at ways to increase entrepreneurship 4.2 percent and 4.8 percent of their by Hilton ag a year from this fall, fol- (Kingsley) property made more sense — and their success — in the state. businesses, respectively, over the lowing a more than $10 million reno- A two-story lobby is among the rather than a short-term gain from a e group is studying state policy ar- same decade. vation to completely update the hotel’s major renovations planned at the potential sale because of the rst-class eas to develop recommendations on To Fowler, the issue is of losing interior and exterior. Kingsley Inn. location of the site,” which is within ways Michigan leaders could re- owners’ wealth and expertise in or- e hotel will also welcome a new the city center district of Bloomeld move barriers to starting a business: der to mentor and support startups. restaurant, Joe Muer Seafood, early next year. Hills, on Woodward Avenue near Long Lake Road. from access to capital, to access to Sen. Wayne Schmidt, R-Traverse Zaid Elia, CEO of Birmingham-based real estate “We feel ... what the hotel has to oer cannot be rep- markets, to recruiting talent. City, introduced the bill. He hopes it company The Elia Group, and Matthew Shiman of the licated anywhere on Woodward,” he said. e problem is particularly acute will get a hearing when the Legisla- Birmingham-based Alden Development Group, the ho- While the hotel’s name will shift to Doubletree by in Michigan, a state that has lost a net ture reconvenes this fall. tel’s owners, had put it on the market last fall, roughly a SEE KINGSLEY, PAGE 18 18,000 businesses since 2006. e “It is a long-term (eort) just try- starkest drops were in the rural north- ing to gure out how do you keep ern Lower Peninsula, as Bridge Mag- capital in here and how do you keep azine reported last month based on young entrepreneurs, that next gen- data from the U.S. Bureau of Labor eration?” Schmidt said. “One of my Statistics. Only three counties — SEE TAX, PAGE 16 Bonds 101 As Michigan’s regional and private colleges dig deep during a building boom, they learn it’s © Entire contents copyright 2016 hard to get good grades on their credit ratings. Special Report, Page 9 by Crain Communications Inc. All rights reserved crainsdetroit.com Vol. 32 No 36 $2 a copy. $59 a year. NEWSPAPER 2 CRAIN’S DETROIT BUSINESS // SEPTEMBER 5, 2016 MICH-CELLANEOUS itary personnel, MLive.com reported. MICHIGAN n A Chicago developer has with- e estimated $2 million project will INSIDE drawn plans for a 12-story hotel and lux- grow the factory by 16,000 square feet. THIS ISSUE ury apartments on a long-vacant down- n Seven Lansing-area residential BANKRUPTCIES ................................15 town block in East Lansing, the Lansing complexes have agreed in a federal CALENDAR .........................................15 State Journal reported. e project, lawsuit settlement to no longer ban CLASSIFIED ADS ...............................15 which was to cost more than $50 mil- families with children from renting KEITH CRAIN.......................................6 lion, will have to be revised — if the de- one-bedroom apartments, MLive. OPINION ..............................................6 OTHER VOICES ...................................6 BRIEFS veloper still thinks it’s worth building. com reported. e federal lawsuit ac- PEOPLE ...............................................14 e package is co-sponsored by e cause is a requirement, buried in an cused a rental manager and three cor- Senate committee OKs RUMBLINGS .......................................19 state Sens. Kowall; Ken Horn, R-Fran- ordinance on building heights adopted porate entities that own the complexes autonomous vehicle bills WEEK ON THE WEB ..........................19 kenmuth; and Rebekah Warren, in February, that for any multifamily of discrimination against families with A four-bill package that would regu- D-Ann Arbor. Kowall said Senate Bills rentals built in B-3 zones downtown, 50 children. Evidence was gathered by late the driverless car industry in 995-998 could be taken up in the Sen- percent of the development must be the Fair Housing Center of Southeast- COMPANY INDEX: Michigan cleared a state Senate com- ate as soon as Tuesday. owner-occupied condos or apartments ern Michigan, which had agents pose as SEE PAGE 18 mittee last week, setting up a possible Lindsay VanHulle for senior citizens. It’s the latest snag in prospective renters asking for one-bed- vote by the full Senate this week. more than a decade of failed eorts to room units, according to the U.S. Attor- would prevent voters from supporting e legislation, introduced in May, Level One to expand transform blighted properties between ney’s oce. ose who said they want- all candidates from one party with one won unanimous support from the the Peoples Church and Abbot Road ed to rent a unit with their child were mark. Schuette says a response is Senate’s economic development and into Grand Rapids market near Michigan State University. turned away. Under the terms of the needed by Sept. 8 so ocials can start international investment committee Farmington Hills-based Level One n Free People, a retailer known for settlement, the defendants will pay printing ballots. e lower courts at a hearing at a facility of Auburn Bancorp Inc. announced last week its American “bohemian chic” apparel $20,000 to victims and $5,000 in civil ruled that the GOP-sponsored law Hills-based Nexteer Automotive in that it will enter the Grand Rapids and accessories, will soon open its rst penalties to the U.S. government. would disproportionately burden Saginaw County, said Sen. Mike Kow- market, its rst expansion into West West Michigan store, at Breton Village n Michigan Attorney General Bill black voters. all, R-White Lake Township, a Michigan. in Grand Rapids, MLive.com reported. Schuette asked the U.S. Supreme n Roger Curtis has left as president co-sponsor of the bills. On ursday, the bank was to ac- Philadelphia-based Free People has Court to intervene so a new ban on of Michigan International Speedway to e bills would allow autonomous quire the lease of a vacant bank branch one Michigan location, at the Somer- straight-party voting can take eect for pursue other opportunities, track vehicles on state roads for any reason, property on Burton Street on Grand set Collection in Troy. the November election, AP reported. owner International Speedway Corp. not only for testing; create the Michi- Rapids’ east side. Over the next several n Global pharmaceutical giant Pfizer e emergency request led Friday announced. Curtis, 49, had been pres- gan Council on Future Mobility within months, the 7,000-square-foot build- Inc.