The county’s position is that Act 88 can be levied without voter approval to fund economic development and agricultural activities. This year, the proposal is to levy 0.07 mills in December 2014 – the same rate that was levied in 2013. It’s expected to raise an estimated $1,022,276 in property tax revenues.

In previous years, the resolution setting this millage has outlined how the revenues would be allocated. The largest allocations have gone to the county’s office of community & economic development, and to the nonprofit Ann Arbor SPARK.

However, at its Nov. 6, 2013 meeting, the board adopted a new policy for allocating Act 88 revenues, drafted by Conan Smith (D-District 9). [.pdf of Act 88 policy] The policy included creating an Act 88 advisory committee to make recommendations to the board and prepare an annual report that assesses how Act 88 expenditures have contributed toward progress of goals adopted by the board. The policy allows the committee to distribute up to 10% of annual Act 88 revenues without seeking board approval. The policy also allocates up to 30% of revenues to the county office of community & economic development, which administers Act 88 funding.

This year, the 10% amounts to $91,753. Of that, $3,993 remains unallocated and will stay in the Act 88 fund balance to support future projects. Beyond that, a total of $87,760 in funding was allocated for six projects initiated by two organizations – the Michigan State University Product Center, and Ypsilanti-based Growing Hope [.pdf of staff memo]:

• $10,060 to the MSU Product Center to study the potential for enhanced food processing in Washtenaw County.
• $12,700 to the MSU Product Center to develop “MarketMaker,” a food industry business network and database.
• $20,000 to Growing Hope/Reconsider to run community education events on the Michigan Invests Locally Exemption Act and to study the potential and processes for investing locally in Washtenaw County.
• $13,000 to Growing Hope/Revalue to provide two full-day educational events to assist investors in incorporating local investment offerings into their financial plans.
• $13,000 to Growing Hope to create a study on increasing food assistance sales at farmers markets in Washtenaw County.
• $19,000 to Growing Hope to support the development of an Ypsilanti “MarketPlace,” a year-round farmer’s market, and “MarketHub,” a food distribution center serving underserved communities.

These recommendations were made to the county board by the Act 88 advisory committee. Members are: County commissioners Ronnie Peterson (D-District 6), Alicia Ping (R-District 3) and Conan Smith (D-District 9); Todd Clark, president of United Bank & Trust; and Art Serafinski, chair of the Ypsilanti Convention & Visitors Bureau board. Staff support was provided by the county’s office of community & economic development.

During the Aug. 6 meeting, commissioner Dan Smith (R-District 2) brought forward an amendment for both the projects resolution and the resolution to levy the tax this year. After some discussion among commissioners, the board unanimously passed this amendment on the projects resolution [strike-through reflects a clause that was struck during deliberations]:

FURTHERMORE BE IT RESOLVED that the Washtenaw County Board of Commissioners directs Corporation Counsel to provide an exhaustive written opinion, by December 31, 2014, detailing the lawful uses of sums raised under Act 88 of 1913 (MCLA 46.161), and that this opinion address in similar manner other possible interpretations.

A similar amendment was passed unanimously for the resolution to levy Act 88:

FURTHERMORE BE IT RESOLVED that the Washtenaw County Board of Commissioners directs Corporation Counsel to provide an exhaustive written opinion, by October 1, 2014, detailing the exact mechanism under which Act 88 of 1913 taxes may be levied in excess of Article IX, Section 6 constitutional limits without a vote of the people.

This brief was filed from the boardroom at the county administration building, 220 N. Main St. in Ann Arbor. A more detailed report will follow.

From left: Washtenaw County commissioner Ronnie Peterson, Ypsilanti city councilmember Pete Murdock, and Ann Arbor Township supervisor Mike Moran, at the county board's March 17 working session on intergovernmental collaboration. (Photos by the writer.)

Their discussion comes in the context of declining property values – property taxes are the primary source of revenue for local governments. In Michigan, constraints on how local governments can generate revenues add an additional layer of complexity. For the county, commissioners and staff are weighing how to overcome a projected two-year, $20.9 million deficit – some feel that collaborating with other local governments is part of the solution.

The talk among Washtenaw County leaders about collaboration also reflects a push at the state level to encourage more such efforts. It’s been a mantra of Republican Gov. Rick Snyder, an Ann Arbor area resident, who wants to use state revenue-sharing dollars as a carrot to get communities to work together. More dramatically, his administration is also advocating for legislation that would make it easier for cities and counties to merge.

Local government officials had been invited to the March 17 meeting to participate in the discussion and air their views on the possibilities for collaboration, as well as roadblocks they anticipate, like issues of cost or control. Many cited the need for better communication, and commissioners indicated a desire to get more involved in existing forums, such as the CEO Group – a monthly meeting of township supervisors led by Dexter Township supervisor Pat Kelly – and the Saline Area Sustainability Circle, which also meets monthly.

Representatives from Ann Arbor Township, Salem Township, Saline and Ypsilanti attended the working session. However, no one came from local governments of the county’s largest population centers – Ann Arbor, Pittsfield Township or Ypsilanti Township – though those areas are also represented by county commissioners. Several people at the meeting expressed the hope that similar sessions would be held in the future, with the additional hope that more local officials would get involved.

Introductions, Framing the Discussion

Typically, working sessions for the county board entail presentations on one or two topics related to the county’s work, with the opportunity for commissioners to ask questions. But the March 17 session on intergovernmental collaboration had a different tone. Yousef Rabhi, chair of the working session, began by asking everyone in the room to introduce themselves, and he invited leaders from other local governments to sit at tables in the front with microphones, where they could participate directly in the discussion.

In addition to some county staff and a few members of the public, local officials at the meeting included Mike Moran, Ann Arbor Township supervisor; Todd Campbell, Saline city manager; Salem Township supervisor Robert Heyl; Salem Township treasurer Paul Uherek; Janis Bobrin, Washtenaw County water resources commissioner; and Gene DeRossett, 14-A District Court administrator. Pete Murdock, an Ypsilanti city councilmember, arrived about midway through the session.

Rabhi pointed out that one of the county’s guiding principles speaks directly to collaboration:

Provide leadership on intragovernmental, intergovernmental and intersectoral cooperation and collaboration aimed at improving services to County citizens.

He noted that at the March 16 board meeting, commissioners had approved a set of priorities and principles to guide the 2012-2013 budget. During that meeting, they’d talked a lot about intergovernmental collaboration, he said. One of the guiding principles that they’d approved dealt directly with that issue:

Guidance Four: Integrate efforts across agencies to meet strategic priorities. The Board seeks to substantively elevate the County’s role in providing leadership on intragovernmental, intergovernmental and intersectoral cooperation and collaboration aimed at improving services to County citizens. Partnership and collaboration are essential components of every County program. [.pdf file of 2012-13 strategic priorities and budget decision principles]

“This is part of that process,” Rabhi said. The county is already collaborating in a variety of ways, he noted, which they are documenting. [.pdf file listing current county collaborations] Examples include the sheriff’s office combining its dispatch operations with the cities of Ann Arbor and Ypsilanti; the county morgue contracting with the University of Michigan Health System to use UM facilities for autopsies; and the county providing IT services for the Dexter fire department, Chelsea police and the city of Ypsilanti.

What followed was a wide-ranging discussion among commissioners and leaders of other local governments. For purposes of this report, the discussion is organized by topic.

Is Collaboration a Priority – And at What Cost?

Rabhi observed that at the March 16 board meeting, some commissioners had indicated they didn’t want to collaborate if it cost the county money. So he posed a question: Should collaboration be a priority, regardless of its expense?

Washtenaw County commissioner Yousef Rabhi, left, who chairs the board's working sessions, talks with Salem Township supervisor Robert Heyl prior to the March 17 working session on intergovernmental collaboration.

Conan Smith, the board’s chair, made some additional points to frame the conversation. They have an interesting opportunity, given the state’s economy, to re-examine how government services are provided, he said. One of the key questions is: At what level is a service optimally provided, and what entity should provide it? Issues that affect the character of a neighborhood probably aren’t a county government responsibility. But perhaps providing a payroll service to local governments is a service the county could offer.

He also pointed out that many issues cross jurisdictional boundaries – like the work of the county’s water resources commissioner, for example. Environmental issues should be looked at from a regional or metro area perspective, he said – or even on the scale of a watershed.

These aren’t necessarily clear-cut decisions, Smith said. And it’s complicated by the fact that different units of government have different authority. Police services and roads are examples where there’s overlapping entities involved. All of these factors should be part of the discussion, Smith said, and should help shape their legislative agenda.

Returning to Rabhi’s question, Barbara Bergman said that any collaboration they do should be cost neutral to the county. Though they should look for opportunities to collaborate, as a steward of public funds, she said, she felt strongly that they shouldn’t use general fund dollars to pursue collaborative projects.

No government wants to collaborate and end up paying more, Smith replied. But there’s recognition that kicking off a collaboration might cost money initially – the idea is that those upfront costs will yield a payoff down the road. The distinction is between one-time costs and longer-term costs, he said.

Bergman responded that if there are start-up costs that don’t result in savings within six to eight months, that would be hard to support.

At that point, Mike Moran – Ann Arbor Township supervisor – approached the podium to speak. He told Bergman that her view is very short-sighted. There are several examples of collaborations that have paid off, but that aren’t necessarily cost neutral, he said – pointing to the Washtenaw Metro Alliance and the Urban County, which both have relied on county staff. And some things didn’t save money, but were worth doing anyway, he noted. The Metro Alliance, for example, came up with a comprehensive open space plan – they didn’t start out with that as a project, but it became a valuable endeavor, he said.

Secondarily, Moran said, a lot of collaboration is happening that might not be officially considered as collaboration. He cited as examples the Washtenaw Area Transportation Study (WATS) and the criminal justice collaborative council (CJCC), on which he serves – those aren’t included on the county’s list of collaborative projects, he noted, but they should be.

Moran also reported that Ann Arbor Township now requires that every development project be vetted by the staff of the Washtenaw County water resources commissioner. That’s not a county requirement, he noted, but another example of two local government entities working together.

Ann Arbor Township supervisor Mike Moran and Janis Bobrin, Washtenaw County water resources commissioner.

Finally, Moran expressed skepticism that any money will be forthcoming from the state for local governments. If there’s a funding pool, it’ll be more like a “baby swimming pool,” he quipped.

Bergman replied that she also serves on the CJCC – when it started, the county was able to fund its start-up costs. But they’re facing a different economic climate now. “I wish now was then,” she said. “But now is now.” Bergman also noted that Janis Bobrin, the county’s water resources commissioner, can manage her budget however she sees fit, “regardless of my comments regarding cost neutrality.” [The water resources commissioner is an independent, elected position. The budget for that office is set by the county board.]

Later in the meeting, commissioner Dan Smith observed that cost savings are the main reason driving collaboration. Over the years, local governments have developed the attitude that they want to deliver the best service possible, and the best way to do that was to do it themselves. But they don’t have the luxury of doing that anymore, he added, and they’re looking to collaborate to save money.

That might be true, commissioner Wes Prater said – the need to save money might have brought collaboration to the forefront. But there’s other value to collaboration, beyond savings. They also need to take into account that each of the local governments have different responsibilities, he said – the trick is to find collaborations that bring value to all involved.

Commissioner Kristin Judge said it was important to remember that the county is a member of SEMCOG (the Southeast Michigan Council of Governments). They pay dues for that membership, she said, and should take advantage of SEMCOG staff who could support collaborative projects – SEMCOG staff is providing that kind of support to a regional IT collaboration that Judge participates in.

Peter Murdock, an Ypsilanti city councilmember, observed that Ypsilanti has been involved in collaborations for decades – he cited the Ypsilanti Community Utilities Authority (YCUA) and the Ypsilanti District Library as examples. The city, which has its own police department, is also talking with Ypsilanti Township about providing police services for the township, he said. Ypsilanti Township currently contracts with the county sheriff’s department for police services.

They’ve already done a lot of cost cutting, Murdock said, and the next few years will be difficult. Collaboration and consolidation might be part of the solution, but Murdock indicated that strategy alone likely wouldn’t be enough to solve their problems.

Collaboration: Communication Is Key

Prater urged local leaders to think of Washtenaw County as one community. Each district is a little different, he said, but everyone is concerned about quality of life and public safety – they know those are crucial for economic development. There are other things, like transportation and good roads, he said, but fundamentally, public safety is the most critical thing for a good economy.

Commissioner Rob Turner said he comes to the discussion from the perspective of public schools – before being elected to the county board, he was a school board member for the Chelsea public schools. School boards throughout the county have a collegial relationship, he said, and collaborate via the Washtenaw Intermediate School District. Many service-sharing initiatives emerge from their discussions, he said, including collaborations related to food services and transportation. He said he didn’t see anything similar among township supervisors or other local government leaders – people just coming together and talking, as they were that night. He wondered if there were meetings taking place that he just wasn’t aware of.

County commissioners Wes Prater and Kristin Judge.

Judge mentioned the CEO Group, a monthly meeting of township supervisors and other local government officials – it’s led by Dexter Township supervisor Pat Kelly. Former county commissioner Mark Ouimet previously served as an informal liaison between the county board and the CEO Group, she said. So the mechanism exists, Judge said – they just need to figure out a better way to take advantage of it. She suggested that perhaps the work of the CEO Group could be better publicized.

Prater noted that former Ann Arbor mayor Liz Brater had started the CEO Group in the early 1990s, when Prater served as supervisor of Ypsilanti Township. Initially, only a few people attended, he said, but now it’s a strong group and provides a forum for local governments to communicate.

Turner observed that county commissioners or staff would benefit from being more than just an occasional guest at those meetings. Judge recalled that when she was first elected to the county board, taking office in late 2008, she was invited to the group. At that time, there was distrust against the county related to a dispute over how townships and other municipalities were charged for sheriff deputy patrols, she said. A lot of work has been done to heal those relationships, she added, and now it seems that members of the CEO Group are more open to working with the county.

Those kinds of animosities generally stem from a lack of communication, Turner said. Moran agreed that the CEO Group meetings have been helpful in leading to more understanding among the different entities, which he said has benefited everyone. At one point he had suggested that each head of the county departments come to the CEO Group meetings to explain to the group what they do, and what their concerns are. A few department heads did that, he said, but it would be helpful to hear from more of them.

Moran also identified the county board’s public commentary rules as a constraint against better communication. During the two opportunities for public commentary at each of their meetings, speakers are limited in time – five minutes at the regular board meetings and working sessions, and three minutes during the Ways & Means Committee meeting.

It’s hard to have a dialogue when you’re limited to speaking for five minutes, Moran said. Also, given the way the county operates, by the time a resolution has reached the board for a vote, the decision about it has already been made, he said. Moran suggested more meetings like this working session would be valuable.

Rabhi noted that there seems to be interest in coming together like this. When he sent out an email invitation to local government leaders, he’d received a lot of responses from people who couldn’t come, but who told him they were “overjoyed” that the county was holding this kind of meeting.

Ronnie Peterson asked other local government leaders to weigh in – what did they want from the county? What are their feelings about how the county currently interacts with them? How can the county enhance existing collaborations? It might be as simple as sharing a dump truck or an office that’s unused. He said the county needs to look for partners to help deliver services to its residents, but some communities want to be isolated – they don’t want to be bothered with collaborative efforts.

Todd Campbell, Saline’s city manager, thanked the board for holding the working session, and said he hoped there’d be more of these meetings in the future, and that more people would attend. For his community, it’s all about providing quality services – and collaboration is key for the future success of all communities, Campbell said. He mentioned ways that Saline is already doing that, citing the work that the Saline police department does with the county sheriff’s office.

Todd Campbell, city manager for Saline, and county commissioner Alicia Ping. Prior to her election to the county board, Ping served on the Saline city council.

Campbell noted that there are 62 employees in Saline city government – 10 fewer than there were eight years ago. At some point, you can’t do more with less – you do less with less. And generally, of the ways to cut costs, they’d already picked the low-hanging fruit.

But there are times when other factors come into play, he added. For example, he said that Saline has a strong city assessor who’s fair and helps educate the public. [Saline's assessor is Catherine Scull.] It doesn’t make sense for them to outsource that job, he said, because she provides such a quality service.

Campbell also stressed the importance of communication. He pointed out that the Saline Area Sustainability Circle has been very helpful – its discussions tend to focus on land-use issues, but other topics are addressed as well. [The group, which Campbell chairs, includes Saline, the Saline Area Chamber of Commerce, Saline Area Schools, Lodi Township, Saline Township, York Township, and Pittsfield Township. Its meetings, held at different locations on the third Tuesday of each month, are open to the public.]

Addressing the topic of barriers to collaboration, Campbell noted that in the town where he previously worked, they talked about those barriers as turf, taxes and tradition. Efforts to collaborate can result in issues of local control, of revenue and of the loss of identify – he cited an example of two school districts that were asked to consolidate, after their sports teams had been bitter rivals for decades. These are some of the challenges.

Alicia Ping, a former Saline city councilmember who now serves on the county board, suggested that the county needs to communicate better with other local governments about the services it already provides. She noted that several years ago, Saline was looking to outsource inspection services. Now, they contract with the county’s water resources commissioner for some of those services – it’s fee-based, she said.

Turner said he’d like to see the county board continue the kind of forum they were having at this working session, perhaps holding them on a quarterly basis. They needed a time when they could just come together and talk with leaders of other local governments.

Moran pointed out that there are a lot of local governments that don’t want to engage with the county, but they should – more people need to attend these meetings, he said.

Campbell also said future forums like this were critical. Often at the state and national level, directives are handed down to local communities, he said – local governments are told what to do and how to do it. A better approach would be to invite local leaders to tell the county what their needs are, he said. That would be crucial – to find out what the ailment is first.

Barriers to Collaboration

Prater said he wanted to talk about why local governments don’t collaborate. All too often, it’s because people have always done things a certain way, he said – change isn’t easy, and it requires people to go outside their comfort level. A lot of people in government don’t want to think about new ideas, but they must, Prater said.

Collaboration also requires good, productive management, Prater said. They need to set performance measures, gather data, and look for efficiencies – it’s not easy, he said.

Moran asked how they would measure a collaborative project, with regards to cost neutrality. Would they measure it at the first dollar that’s spent? Ventures like the Metro Alliance might take a couple of years to pay off, he noted. Judging whether something is cost neutral is meaningless unless there’s a timeframe attached, Moran said.

Planning is key, Prater replied. If initial planning reveals issues that might result in a collaboration not working, then you stop it. These days, he said, it’s all about the revenues – or lack thereof.

Leah Gunn said it’s not just about the county’s revenues – declining property tax revenues are an issue for all local governments. Foreclosures are happening in all districts, including hers, she noted. [Gunn represents District 9, which covers a portion of Ann Arbor.]

In the end, collaboration will pay off, Gunn said. She called the list of current collaborations “amazing,” noting there are others – like the Metro Alliance – that aren’t listed. Her understanding is that the Metro Alliance, which has been inactive recently, is being reconstituted, which she said is a good thing. Recent collaborations among some of the county’s fire departments stemmed in part from the Metro Alliance’s request that fire chiefs to attend one of their meetings, she said.

From left: Salem Township treasurer Paul Uherek, Salem Township supervisor Robert Heyl, and county commissioner Conan Smith of Ann Arbor.

Later in the meeting, Salem Township treasurer Paul Uherek told commissioners that after the last snowfall, it took the county road commission three days before the road was plowed in front of his house. It would be useful for commissioners to ask why some local governments didn’t want to engage in collaborations, he said.

Judge later clarified that the county board isn’t responsible for clearing the roads – the road commission is a separate entity, although the county board is responsible for appointing the three road commissioners who oversee that operation.

Peterson noted that sometimes, people feel their concerns get lost. To say that the road commission is a separate entity ignores the role that the county board plays in appointing road commissioners, he said. Other local governments need to feel they are members of the team, he said, and at the end of the day, people want to be able to pick up the phone and get something done. And at the end of the day, he said, the county board is responsible for the road commission. It’s all about trust, he said – unless the county government has the trust of all municipalities throughout the county, they’ll never get to where they need to be in streamlining operations and cutting costs.

Turner noted that he served as a board liaison to the road commission, and he offered to follow up on the Salem Township issue. He asked them to contact him if there are any problems in the future. Referring to a statement made earlier in the meeting – that most communities have already picked the low-hanging fruit of cost savings – Turner said they’ll need to stand on each others’ shoulders to get at the higher-hanging fruit. “We’re here to help you,” he said, “and that’s what we want to do.”

Moran said he now knows who to call at the road commission, and how to get results – but 10 years ago, when he was new to office, he didn’t. He suggested coming up with a list of important contact information that could be distributed to all local governments.

Dan Smith said it’s true that most communities have already picked the low-hanging fruit. Now, as they brainstorm ideas for collaboration, they’ll face some serious roadblocks.

For example, consider the idea of a countywide fire department – though Smith stressed he wasn’t advocating for this. Residents don’t care where firefighters get trained or how many fire chiefs there are. They just want firefighters to respond when there’s a fire – they care about how quickly firefighters respond. It’s possible for this service to be delivered by a countywide entity, with lots of substations. But working through the details of that would be very difficult, he noted, given that there are currently multiple fire departments across the county.

Potential Areas of Collaboration, Next Steps

In looking at specific areas of possible collaboration, Conan Smith noted that the budget priority document the board approved on March 16 includes two outcomes that were relevant to the current discussion:

• Reductions in cost or duplication of the provision of “invisible” services; and
• Increased support for discretionary services that are board priorities.

Invisible services would include things that aren’t directly seen by residents, such as payroll or human resources. Smith asked if opportunities for collaboration existed in that area.

Campbell reported that from Saline’s perspective, they already contract out for their payroll services – they no longer do that in-house. He said that he heads up the city’s HR, because everyone wears many hats.

Murdock said that Ypsilanti had previously looked at the possibility of outsourcing some of those services, like HR and payroll. At the time, it didn’t make sense – or cents – to pursue, he said. Those aren’t big-ticket items like police or fire, where they could see significant savings from changes.

Conan Smith observed that one consistent theme had emerged that evening – the importance of dialogue and conversation. He said they needed to enter a process of discovery, cataloging all the existing opportunities and reviewing how the county board might participate in them. For example, they haven’t been active in the CEO Group – they could increase their engagement in that. They could also have a representative attend the Saline Area Sustainability Circle, and the Eastern Leaders Group.

Bergman added the community health collaborative to that list, saying they could put more muscle into its activities.

Judge suggested creating a menu of services that local governments could provide to other entities. For example, if there are services that one community provides particularly well – like Saline’s assessor – then perhaps other local governments could contract with them for those services.

Peterson said that for their next meeting on collaboration, they should solicit input from a broader range of elected and appointed officials throughout the county. How do they think the county can work better with their communities?

Washtenaw County administrator Verna McDaniel, left, and county commissioner Leah Gunn. The working session was held on St. Patrick's Day – thus the high percentage of green clothing on display.

Picking up on an idea mentioned earlier in the meeting by Moran, Gunn suggested creating a list of contact information for county services. When you’re new to office, there’s a steep learning curve, she said. Bergman proposed posting this information on the county’s website. She also said it was important to get more input from other local governments about how to continue this dialogue.

Peterson felt it should be more than just a list of numbers. New county commissioners get an extensive orientation regarding county services, which includes the opportunity to meet with heads of departments and programs. Something like that might be helpful for leaders of other local governments.

Conan Smith cautioned that it seemed they were on the verge of creating a new project, and he was sensitive to the constraints on their budget and staff time. He asked for some commissioners to look into how much it might involve, and to bring back a report to the board. Rabhi, Bergman and Peterson volunteered for that task.

Peterson then noted that they’ve invited members of other local governments to the table, and that long-term relationships like this might bring some costs. “Let’s not ask for a date if we can’t afford to take them out,” he said.

Judge also expressed concern over creating a new project, noting that other forums already exist, including the CEO Group and the Metro Alliance. In addition, the board’s budget priorities, which they had approved at their March 16 meeting, include a priority to market the county’s services to other entities – that’s something they’ve already asked the county administration to do. She’d rather see them simply add to whatever already exists, not develop something new.

Turner said he understood Judge’s position, and if they can work with existing forums, that’s fine. However, he noted that so far, that hasn’t seemed to work very well – there are still significant communication gaps. They might need a different venue to do that, with a more comfortable atmosphere.

Robert Heyl, Salem Township’s supervisor, said he liked what he heard that night. He noted that each commissioner represented different parts of the county, and they could reach out to other local government leaders within their districts. Meeting one-on-one with other elected officials in their districts would be helpful, he said. The forum that night had been a good start, he said, and he hoped it would continue.

Rabhi wrapped up the working session by saying the discussion had opened a lot of doors, and that they’d hold more meetings like this in the future. The county is eager to work with everyone to best serve the residents, he concluded, “because that’s what we’re all here for.”

Present: Barbara Levin Bergman, Leah Gunn, Kristin Judge, Ronnie Peterson, Alicia Ping, Wes Prater, Yousef Rabhi, Conan Smith, Dan Smith, Rob Turner.

Absent: Rolland Sizemore Jr.

Next regular board meeting: Wednesday, April 6, 2011 at 6:30 p.m. at the county administration building, 220 N. Main St. The Ways & Means Committee meets first, followed immediately by the regular board meeting. [confirm date] (Though the agenda states that the regular board meeting begins at 6:45 p.m., it usually starts much later – times vary depending on what’s on the agenda.) Public comment sessions are held at the beginning and end of each meeting.

From left: David Stead, Jean Carlberg, and Fulter Hong at an April 13 working session on sustainability. They are members of the environmental, planning and energy commissions, respectively. (Photos by the writer.)

The discussion touched on the conceptual as well as the concrete, with some commissioners urging the group to tackle practical considerations as well. The chairs of each commission – Bona, the energy commission’s Wayne Appleyard, and Steve Bean of the environmental commission – set the stage by talking about the roles of their appointed public bodies, and how sustainability might be incorporated into their work.

Specific ideas discussed during the session included financing energy improvements in households through a special self-assessment on property tax bills, and tapping expertise at the University of Michigan.

More than midway through the meeting they were joined by Terry Alexander, executive director of UM’s Office of Campus Sustainability. He described UM’s efforts at implementing sustainable practices on campus as well as creating a living/learning environment for students, teaching them what it means to be a “green citizen.”

Toward the end of the meeting, Bona noted that the issue extended far beyond the three commissions gathered around the table. Housing, parks and other areas need to be involved as well, she said, if they were truly to tackle the three elements of sustainability: environmental quality, social equity, and economic vitality. Bean said he and the other chairs would be meeting again and come up with some specific examples for what steps might be taken next. “You’ll be hearing from us,” he said.

Planning, Energy & Environment: An Overview

Bonnie Bona began the discussion by describing the work of the planning commission, which she chairs. They’re responsible for the master plan and ordinance revisions related to planning, and work on a raft of issues through standing and ad hoc committees, including area, height & placement standards, capital improvements, and R4C/R2A zoning districts, among others.

Bona said she’s been thinking about the concept of sustainability for several years, and the questions that it raises. For example, what’s the sweet spot for building height and density, to create a sustainable community? In her work on the area, height & placement committee, each time they’ve gotten comfortable with a certain level of density, they’ve asked: Why not push it a little more? Bona said she doesn’t know what optimal density is, but she’s feeling less and less comfortable relying on political winds, and not having a way to measure it.

Beyond density, she said they haven’t been considering the other elements of sustainability – economic vitality, and social equity. These are broader issues that encompass more than just planning, she said. A more productive way to move forward would be to take a comprehensive look at what it means to be sustainable. “And that is how I got here,” she said.

Wayne Appleyard, chair of the Ann Arbor energy commission.

Energy Commission

Wayne Appleyard, who chairs the energy commission, said the group was trying to help meet the city’s green energy challenge, set in 2005: To use 30% renewable energy in municipal operations by the year 2010. He noted that the deadline is coming up quickly. The goal for the entire community is 20% renewable energy by 2015.

City government is close to meeting its goal, Appleyard said, with its “green fleets” program using alternative fuel vehicles, electricity generated from landfill gas and two dams on the Huron River, and other efforts.

For the broader community, the commission is exploring the PACE (Property Assessed Clean Energy) program as a way for homeowners to finance energy improvements, like installing a solar energy system. [Matt Naud, the city's environmental coordinator, explained the program in more detail later in the meeting.] Other possibilities include requiring time-of-sale energy audits, so that potential homebuyers could wrap funding for energy improvements into their mortgage; educating the public about renewable energy and energy efficiency measures; and figuring out how to generate more electricity from dams on the Huron River.

Appleyard also discussed what it means to be sustainable. Often it’s considered as meeting our needs today, without harming future generations. It takes into account both economic and social aspects as well. He quoted William McDonough, author of “Cradle to Cradle: Remaking the Way We Make Things,” in describing the outcome of sustainability: “a delightfully diverse, safe, healthy and just world, with clean air, water, soil and power – economically, equitably, ecologically and elegantly enjoyed.”

Achieving these goals means redefining everything we do, Appleyard said. Sustainability means you have to account for everything you do, and do things only that make sense for all three areas: environmental, economic and social.

Environmental Commission

Steve Bean described the work of the environmental commission as advising the city on issues related to the environment and sustainability. The group has six committees: natural features, solid waste, water, transportation, State of Our Environment, and sustainability community. Ad hoc committees include recycling and the Huron River and Impoundment Management Plan (HRIMP).

Bonnie Bona, chair of the Ann Arbor planning commission, and Steve Bean, who chairs the city's environmental commission.

The sustainability committee is taking a three-phase approach to its work, Bean said: 1) looking at what the city does now that isn’t sustainable, 2) developing an environmental action plan to show how to work toward their goals, and 3) broadening the goals to include elements of the economy and social justice.

The sustainability committee has also been working with the Transition Ann Arbor group, Bean said. [See Chronicle coverage: "Transitioning Ann Arbor to Self-Reliance"] That group is focused on transitioning the community in light of an end to cheap oil – known as “peak oil” – climate change and economic instability. One aspect of their plan is to build bridges to local government, Bean explained, so the sustainability committee offered to serve that function. They’ll be talking about how the Transition Ann Arbor plan meshes with the city’s efforts toward sustainability.

Bean also said he felt that the term “sustainability” was used too loosely: Something is either sustainable, or it’s not.

Starting the Discussion: Some Questions

Bonnie Bona began the more general discussion by posing four questions: 1) Where are there opportunities or overlap for pursuing sustainability among the three commissions? 2) What are the constraints? 3) Should they measure progress? and 4) Is there consensus toward a way of moving forward, or a goal?

The three commission chairs have been meeting regularly and will continue to do that, Bona said. There are also things that can be done informally. But she wondered whether there was any interest in forming a joint steering committee on this issue, or pursuing a community-wide discussion.

Commissioners Weigh In

Planning commissioner Jean Carlberg, a former city councilmember, began her comments from a personal perspective: How can she heat her house and get electricity in an energy efficient, cost-effective way? She pointed out that what she has to do individually is exactly what every city has to do on a larger scale. How can they develop pathways to move away from reliance on oil and natural gas?

Wayne Appleyard said that you start by making energy efficiency changes in your home, because those are the cheapest. Payback on your upfront costs is always an issue, he said. “And I’m convinced the future isn’t going to be like the past, so payback is harder to predict.” Once you reduce energy costs as much as possible that way, you can start looking at renewable energy to meet your needs, he said.

Steve Bean noted that the PACE program is one potential way for homeowners to fund energy improvements. John Hieftje, the city’s mayor who also serves on the energy commission, said that he, Mike Garfield of the Ecology Center, Ann Arbor energy programs manager Andrew Brix and Matt Naud, the city’s environmental coordinator, have visited Lansing to meet with legislators, asking them to approve the enabling legislation needed to make PACE possible.

PACE: Property Assessed Clean Energy Program

Naud gave a more detailed explanation of the program, saying that several other states have enacted legislation to support it. He explained that while there are programs available for low-income homes – like the county’s weatherization efforts – it’s more difficult for people at middle-income levels to find resources. Banks aren’t lending, he said, so there’s a gap in how to pay for upfront costs to make your home more energy efficient.

The program would be voluntary. Homeowners would first get an energy audit to find out if they’ve already taken initial steps on their own – for example, Naud said, you wouldn’t want to install solar power if you haven’t sufficiently caulked around your windows. You’d sign a contract with the city, which Naud said would microfinance the improvements. To repay the loan, homeowners would get an additional assessment on their property tax bills.

The risk is low, Naud said, as long as they structure the program in the right way – for example, not lending to people who are upside down on their mortgages, owing more than the home is worth. There’s already a system in place to make payments – the tax bills – and the improvements would add value to the property. The city has set aside $400,000 from a federal Energy Efficiency and Conservation Block Grant it received, to use as a loan loss reserve fund. If the enabling legislation is passed, the city would be able to put together a package that would work, Naud said.

[Link to a September 2009 article about the PACE program, written by Eric Jamison, a law student at Wayne State University Law School who's working with the Great Lakes Environmental Law Center to develop the program in Michigan. More information is also available on the PACE Now website. Previous Chronicle coverage related to PACE: "Special District Might Fund Energy Program"]

Other Thoughts: Regionalism, Economic Impact, Trees

Mayor Hieftje said that talk of sustainability can’t just stay within the city’s borders. It’s important to look at it regionally, as the city has done with the greenbelt program, the Border-to-Border trail and transportation, including efforts to develop a commuter rail system. What is Ann Arbor’s responsibility to other communities, he asked. Also a factor – thousands of new jobs are expected to be added in this area in the coming years. “It’s a big issue, and I don’t think we can talk about it within city borders and do it justice.”

David Stead of the environmental commission said the Ann Arbor region should be looking at the issue of sustainability as an economic development tool. Michigan is going through dramatic change, he said, and Ann Arbor is at the epicenter as the state shifts from an industrial economy to whatever comes next – possibly clean energy. “We can be the model and the driver for that,” he said.

From left: Chuck Hookham, Josh Long, and Diane Giannola. Hookham and Long are members of the Ann Arbor energy commission. Giannola is a planning commissioner.

Valerie Strassberg, also on the environmental commission, said it was difficult to know where they were going without knowing where they were now. This community is different from Berkeley or Portland or Seattle, she said. What are lifestyles like now in Ann Arbor, and how much would they need to shift to be sustainable?

Josh Long of the energy commission talked about the continuum of how to get energy, from efforts by the individual homeowner, which are easier to control, to the energy provided by large utilities. Large-scale energy generation is more cost effective at this point, but when it’s transmitted over long distances, some energy is lost. The sweet spot might be generating energy on a regional or district scale, but there are legal constraints to doing that.

Tony Derezinski, a planning commissioner who also represents Ward 2 on city council, said he’s interested in distributive justice – making sure the community’s benefits and burdens are spread equitably. Congress has dealt with health care, he said – what about energy, or water? How you do it is the trick, he said.

Erica Briggs, also on the planning commission, wondered what exactly they want to sustain in the community, and regionally. There’s talk about sustainability in the Washtenaw Avenue corridor, but what does that actually mean? When you start looking at it in detail, she said, it’s difficult. Briggs gave the example of her own house, which she described as an “energy hog.” Even though she loves it, she said it probably shouldn’t have been built.

Gwen Nystuen – who serves on both the environmental commission and the park advisory commission – said she wanted to put in a “big word” for trees. Trees are an important component of sustainability, helping in water protection, for example. The type of tree as well as its location should be considered carefully, she said.

Keeping It Real: What Does This All Mean?

Eric Mahler of the planning commission was the first to raise some concerns about the conceptual nature of the conversation. When evaluating a site plan, he said, “it’s hard to think of distributive justice.” He disagreed with Steve Bean’s earlier statement that sustainability was an all-or-nothing concept, and said he didn’t feel the group had reached a consensus about what it means to be sustainable.

Mahler also raised several questions: How does sustainability intersect with historic districts, or design guidelines? Does the city have the option of regulating building materials, with an eye toward sustainability? What are the city’s enforcement capabilities? He urged commissioners to think about the issue in terms of their clearly defined roles. “I wish I had answers for you, but I just have questions.”

Steve Miller of the energy commission had similar concerns, saying he was disappointed by the lack of specifics in the discussion. As he listened to the high-level talk, he said he had no idea how to apply it to goals that they might have a chance of achieving. For example, the city is pursuing a program to install LED lights, he noted, but it’s not clear whether that technology is sustainable in the long haul. In 2025, will LED lighting be the best choice? And discussions of regionalism didn’t seem to take into account the legal constraints they were working under, he said. He wasn’t hearing a lot that would help move some of these issues forward.

Planning commissioner and former city councilmember Wendy Woods described the discussion as great. “But I’m sitting here thinking, ‘Now what or why am I here or what am I supposed to do?’ I’m sure the public is out there wondering too.” All of the commissions are advisory to city council, she noted, and all have long lists of tasks that they’re working on. Is the goal to simply define what sustainability is?

Bean said this was the kind of feedback they wanted. The organizers were just interested in starting a discussion, and seeing where it goes. If they don’t reach consensus, he said, at least they might have a sense of what steps to take next.

Margie Teal, a Ward 4 representative on city council and a member of the environmental commission, said there seem to be answerable questions that can be tackled by the planning commission, like how the city’s area, height and placement (AHP) standards interface with density. “I welcome them digging in and pursuing that,” she said.

Evan Pratt of the planning commission said he liked the overarching goals that the energy commission is working toward – of 20% and 30% renewable energy use – and the goals that the environmental commission is tracking through the State of Our Environment report. From a policy perspective, planning has a role to play, too, in furthering sustainability goals. “It’s pretty clear that some change is necessary,” he said. Pratt suggested identifying common goals that each commission can work toward.

Bean said he thinks of sustainability as a filter that each group can apply, asking how each policy or project they deal with affects the environment, social equity and economic vibrancy.

Dina Kurz, a member of the energy commission, noted that all the commissions are advisory to city council, and that there are areas where their missions overlap. For example, the energy commission has discussed solar access zoning – that’s clearly a relevant topic for the planning commission, too. She said she doesn’t believe that sustainability can be just a city-driven effort, but that they can only change the things that they control. They need to figure out what those things are, she said, and how to leverage their partners to move forward.

Sustainability: The University Perspective

Terry Alexander attended Tuesday’s meeting to give an update on initiatives at the University of Michigan. He was appointed as director of UM’s office of campus sustainability last year – The Chronicle had previously encountered him at the December 2009 board of regents meeting, where he described sustainability initiatives underway on campus.

Terry Alexander, director of the UM Office of Campus Sustainability.

On Tuesday, Alexander gave a similar presentation, though he had exchanged his suit and tie for more casual garb. He told commissioners that UM president Mary Sue Coleman hoped to make the university a world leader in sustainability, and to develop a living-learning environment for students. UM touches the lives of 40,000 students each year, he said – if they leave campus with even a little awareness about sustainability, they’re the ones who will go out and change the world.

The Executive Sustainability Council – led by Coleman and consisting of many of the university’s top executives – sets broad policy and goals for the initiative. The academic and research efforts are led by the Graham Environmental Sustainability Institute. Some of that entails recruiting faculty with interests in sustainability, who can attract research dollars, Alexander said. He pointed to the Erb Institute and the Michigan Memorial Phoenix Energy Institute as other examples of sustainability-focused research. There are also about 50 student groups on campus that have a sustainability component – the Graham Institute is trying to coordinate those efforts, too.

Alexander described his own office’s mission as three-fold:

1. Establish long-term “stretch” goals for the university. UM has been doing things like conserving water and energy for years, he said. Now, they need to come up with goals that will change the way people think about things on campus. They’ve set up teams to make recommendations in seven areas: buildings; energy; land and water; transportation; purchased goods; food; and culture (changing people’s attitudes). Alexander said they hope to have goals set by later this spring.
2. Coordinate the existing sustainability projects already underway on campus. There are over 200 projects that relate to sustainability, Alexander said – some new, some that have been around for years. His office will try to coordinate these efforts and help people find the resources they need.
3. Get the word out. There’s a lot going on, but they need to communicate that to the community, state and nation, Alexander said. One of their current publicity efforts is an annual Environmental Report, a brochure that he passed out at Tuesday’s meeting. [.pdf file of 2009 Environmental Report] “If we don’t get word out,” he said, “we’ll never be recognized as world leader.”

John Hieftje, the city’s mayor who also serves on the energy commission, said the city is working with UM on a study for a possible bus connector system to run through Ann Arbor, along the South State and Plymouth Road corridors. [See Chronicle coverage: "Green Light: North-South Connector Study"] But a few years ago, he said, the city tried to partner with UM in purchasing LED lights, and he couldn’t understand why the university didn’t want to work together on that. “As we move forward, keep us in mind,” he told Alexander, adding that UM might be going over ground that the city has already covered. He noted that Ann Arbor has won awards for its environmental efforts.

Responding to Alexander’s comments later in the meeting, David Stead of the environmental commission asked how conversations at the executive level related to sustainability as a community-based function. The university doesn’t always consider its impact on the community, Stead said, adding that there’s a long history of ignoring things, like compliance with building codes. “If you’re going to do sustainability, I certainly hope it doesn’t stop at State Street.”

Alexander said it was a valid point, but he doesn’t participate in the executive-level discussions. However, he said there was a lot of interaction between the university and city staff at the planning level, including monthly meetings between the two groups.

Next Steps

Jason Bing of the energy commission, who also manages Recycle Ann Arbor’s Environmental House, said that the only way Ann Arbor would meet its goals is to link with the university and regional partners. If everyone embraces the same goals, that will allow things to happen on the ground. It had been extremely valuable to bring the commissions together, he said.

Fulter Hong, a manager at Google who serves on the energy commission, suggested setting up an online discussion group so that members could continue these efforts, rather than relying on the commission chairs. It’s a tactical approach to keeping the discussion active, he said. Valerie Strassberg of the environmental commission suggested setting up a Facebook group or a blog.

Steve Bean pointed out that the environmental commission includes representatives from other commissions, as a way to keep informed about what other groups are doing. “I’m learning it’s not a two-way street,” he added.

Matt Naud suggested that the Urban Sustainability Directors Network, which he’s active in, could be a resource.

Setting Goals: The State of Our Environment Report

Referring to the city’s State of Our Environment report, Jean Carlberg – a planning commissioner and former city councilmember – said she’d like to see someone prioritize the next steps to achieve the sustainable energy goals. What steps should be taken, at both the individual and institutional level? The planning commission isn’t the best place to do that, she said, but it seems like it’s appropriate for the energy and environmental commissions. “I’m happy to follow somebody else’s lead,” she said.

Planning commissioner Eric Mahler agreed, but suggested that perhaps the planning commission can take a small portion of the city – the South State Street or Washtenaw Avenue corridors, for example – and ask what sustainability might look like, from all three perspectives: planning, energy and environmental. He proposed that the chairs make recommendations to the rest of the commissioners about how to proceed.

David Stead of the environmental commission noted that that the State of Our Environment report was based on data. Their intent was to identify goals and metrics. He suggested that each commission could do the same. The planning commission, for example, might want to look at density and ask what are the goals, and how would they be measured.

Valerie Strassberg said there were some things she’d like to bring to planning commission. She serves on the environmental commission’s water committee, and they’ve talked about why gray water can’t be used in toilets – it might be possible to change building codes to allow that, she said.

“I’m not sure toilet water quality is in our purview,” Mahler quipped.

John Hieftje took issue with some of the environmental indicators in the State of Our Environment report. He noted, for example, that the bicycling indicator was listed as “fair,” but that Ann Arbor ranks among the top in the nation for bike-friendly communities. Steve Bean replied that the indicators reflect how the city is doing relative to its own goals, not compared to other communities.

Sustainability: Role of the City Council

Josh Long of the energy commission observed that the way government is structured is an impediment to achieving sustainability. The recent city staff reorganization, he said, reflects priorities. In the org chart, the city administrator and city council are on top, followed by budget and finance staff, then everyone else. That reflects financial priorities, but not the environment or social justice, he said. Reorganizing to elevate the status of environmental and social justice issues would be a difficult thing to do, he said, but an important one. That way the city could really start focusing on sustainability.

From left: City councilmembers Carsten Hohnke (Ward 5), Tony Derezinski (Ward 2) and Margie Teall (Ward 4). Derezinski serves on the planning commission. Hohnke and Teall are on the environmental commission.

Wendy Woods, a planning commissioner, pointed out that the city council could take action on these issues, if they had the mindset to do so.

City councilmember Carsten Hohnke (Ward 5), who also serves on the environmental commission, said that one of the themes he’d heard during Tuesday’s meeting was that for sustainability to gain traction, there’s a cultural change that needs to occur. Perhaps one way to change people’s attitudes is to translate sustainability into very direct benefits for the community. For example, if people can see that their energy bills would go down when they take certain actions, that might change their behavior.

The council talks about its priorities and goals at an annual planning retreat – Hohnke said it would be good to touch base with the chairs of these commissions before the retreat.

Finally, he noted that the local food system was another element of sustainability, and there are efforts underway to increase the amount of money that residents spend on locally produced food. [See Chronicle coverage: "Column: The 10% Local Food Challenge"]

Bonnie Bona wrapped up the meeting by noting that the issue extended far beyond the three commissions – housing, parks and other areas need to be involved as well. Steve Bean told the group that the three commission chairs would come up with recommendation for steps that might be taken next. “You’ll be hearing from us,” he said.

Present: Energy Commission: Wayne Appleyard, Jason Bing, John Hieftje, Fulter Hong, Charles Hookham, Dina Kurz, Josh Long, Steve Miller, Ken Wadland. Environmental Commission: Steve Bean, Carsten Hohnke, Gwen Nystuen, David Stead, Valerie Strassberg, Margie Teall. Planning Commission: Bonnie Bona, Erica Briggs, Jean Carlberg, Tony Derezinski, Diane Giannola, Eric Mahler, Evan Pratt, Wendy Woods.

The entrance to the John Leidy shop at 601 E. Liberty, next to the Michigan Theater. (Photo by the writer.)

Just after noon on Sunday, several people had already assembled in the John Leidy gift shop on East Liberty: three generations of the family-owned business, and two self-described “Leidy Ladies” – long-time staff at the 58-year-old store.

A Chronicle reader had contacted us with news that the store planned to close. So we stopped by to talk with the Leidy family, who were gathering there after coming from church: John Leidy’s widow, Ann Leidy, their daughter Liz Arsenault, who manages the store, and son Peter Leidy, who’s acting as spokesman for the family.

Postcards were mailed to their customers over the last few days announcing plans to close at the end of February, when their lease is up. But on Sunday, Peter Leidy told The Chronicle that they weren’t yet ready for an interview. There’s a lot of emotion, he said, and gratitude to customers – but it’s a hard time for them.

Instead, Leidy emailed a written statement. Here’s their message:

It has been a truly wonderful and fulfilling fifty eight years. The shop, customers, and employees have been a gift to our family.

We understand that many people will wonder “why?” Some factors that led to this difficult decision are changes in how people shop, requirements by suppliers, competition from suppliers that sell directly to the public, and increased freight costs.

We are sad to be closing, and we are grateful for the friendship of our loyal customers and the Ann Arbor community.

The Leidy Family

John Leidy opened the business in November of 1951. The shop’s current stock reflects the merchandise he first carried: fine china and crystal, silver, dishware – with brand names like Royal Doulton, Wedgwood and Baccarat. These are the kinds of items you’d list on a wedding registry, which hundreds of Ann Arbor couples did there over the decades.

In addition to its wedding registry-type inventory, the store today carries a wide range of other merchandise, including jewelry, candles and figurines. At this time of year, it’s also packed with holiday ornaments and Christmas-themed items – many of them now deeply discounted.

In the 1960s, Leidy opened a second store on the opposite side of the theater. The family consolidated the two stores into one location in 2006. That same year, the store was featured in an Ann Arbor Area Business Monthly article, marking the 55th anniversary of the business. The article quoted Liz Arsenault, who described how the store kept very close to the traditions established by her father, who died in 1993. “We wouldn’t have a computer if UPS didn’t require us to use it for shipments,” she told the magazine.

The John Leidy shop is the latest in a series of business closings over the past year. Some of them, like John Leidy, have been fixtures of the downtown area for decades – most notably Shaman Drum Bookshop on South State Street, which closed on June 30 after nearly 30 years in business.

Store hours at the John Leidy are Mon.-Sat. 9:30 a.m.–5:30 p.m. and Sun., noon-5 p.m.

Paul Saginaw, co-founder of Zingerman's, spoke about building a local "living economy" at Monday night's Think Local First annual meeting. (Photo by the writer.)

Paul Saginaw joked that during his senior year of high school, he was voted Least Likely to Have a Positive Impact on Society. The remark drew a laugh from the crowd of more than 100 people attending Think Local First’s annual meeting on Monday night – most of them know the Zingerman’s co-founder is an advocate for socially responsible business, as well as a driving force behind the nonprofit Food Gatherers, which launched 21 years ago this week.

For many years, that high school description was “so true,” Saginaw said. “But for the second half of my life, I’ve been trying to prove them wrong.”

Saginaw, the evening’s featured speaker, talked passionately about the need for local economies built around “human-scale” enterprises, with businesses as a positive force for social change. He described several ways that the Business Alliance for Local Living Economies, a national group, is supporting the efforts of small, independent businesses. The goal? “What we want to do is change the world,” he said.

BALLE – Building a National Network

Saginaw serves as vice chair of the board of directors for BALLE, the acronym of the Business Alliance for Local Living Economies. Judy Wicks – the group’s founder and owner of White Dog Cafe in Philadelphia – was the speaker at last year’s Think Local First annual meeting. [See Chronicle coverage: "Thinking (Eating, Drinking) Local First"]

At Monday’s event, held at Big George’s on West Stadium Boulevard, Saginaw described several initiatives that BALLE is undertaking. The group is a “network of networks,” he said – Think Local First is an affiliate – representing over 20,000 independent businesses in the U.S. and Canada. Their goal is to strengthen and connect these networks, helping communities build sustainable economies through independent retail, sustainable agriculture, green building, renewable energy, community capital, and zero-waste manufacturing. The organization is eight years old, Saginaw said, “but it’s starting to get traction now.”

Saginaw said that BALLE has secured major funding from the NoVo Foundation, led by the son and daughter-in-law of financier Warren Buffet. BALLE also has hired a new director, Michelle Long, who previously was co-founder and executive director of Sustainable Connections in Bellingham, Washington – an organization similar to Think Local First that eclipsed their local chamber of commerce in membership, Saginaw said.

BALLE will be pushing for public policy changes that favor small, independent businesses, Saginaw said. Right now, it’s easier to withdraw all of your savings and lose it gambling in Detroit’s Greektown Casino than it is to invest in a local business, he said, and that needs to change. It’s part of the concept of community capital – keeping dollars local, whether it’s buying from a locally owned shop or investing in a local business.

In addition, BALLE’s research and public policy director, Michael Shuman, will be putting out a monthly e-zine – a magazine distributed via email and other electronic means – on issues related to sustainable, living economies. Shuman is the author of “The Small-Mart Revolution: How Local Businesses Are Beating the Global Competition.” Copies of the book were raffled off during Monday’s event.

During the first part of his talk, Saginaw focused on the efforts of BALLE. He devoted the rest of his speech to an impassioned defense for the virtues of building sustainable local communities. In many cases, business has become an instrument of greed rather than one of social good, he said. But as local business owners, he continued, we know that business can be beautiful – an expression of personal creativity, providing meaningful work to others at a fair wage, and creating a mechanism for social change.

The latter kind of business, he said, is the foundation for a healthy community and a healthy democracy.

Think Local First: Looking Ahead

As part of Monday’s annual meeting, Ingrid Ault, executive director of Think Local First, gave brief remarks before Saginaw’s presentation. Ault said the group is focused on two main goals for the coming year: 1) overhauling their website, with help from Bonnie Valentine of The Whole Brain Group, and 2) applying to become a 501(c)3 nonprofit. The group’s current status as a 501(c)6 nonprofit does not allow them to apply for certain grants or take advantage of tax-deductible donations, she said.

Longer term, Ault said they hope to get sufficient funding to turn her part-time position into a full-time one, so that she’d have more time to devote to the buy local movement.

Natalie Marble, owner of Ann Arbor Cooks, sprinkles sugar on pumpkin crème brûlée to be served at the Think Local First gathering. Ann Arbor Cooks was one of several local businesses that provided food and beverages for the event. (Photo by the writer.)

Bonnie Valentine of The Whole Brain Group holds up a bowl to collect business cards – later, cards were drawn for raffle prizes. (Photo by the writer.)

Charlie Hickman, left, draws a business card out of the bowl to see who'll win a copy of Michael Shuman's book, "The Small-Mart Revolution: How Local Businesses Are Beating the Global Competition." Looking on is Charlie's brother Joe Hickman. In the background is Bob Dascola of Dascola Barbers. (Photo by the writer.)

Kelly Zorn of Z Design Studio, far right, was recognized for designing the recently published Think Local First resource guide. In the foreground are Claire and Paul Tinkerhess, owners of Fourth Ave Birkenstock and Fourth Ave Sleep Shop. (Photo by the writer.)

Abracadabra is located on East Liberty across from the federal building and post office, between Chelsea Flower Shop and Sam's Clothing.

Steven Lesse has some stories to tell – making a necklace out of a gall stone is just one of them.

The co-owner of Abracadabra Jewelry and Gem Gallery has seen a lot since opening his downtown Ann Arbor shop in 1974. Originally located in the building that now houses Herb David Guitar Studio, Abracadabra moved to its current location at 205 E. Liberty in 1976 and has remained there ever since. Lesse, who co-owns the business with his wife Katherine, fell in love with Ann Arbor when he set up a booth at the art fair during the summer of 1973.

“I was tired of the gypsy lifestyle – it was like being in a rock band,” Lesse said. “You were always traveling around city to city, art fair to art fair. It was a fun lifestyle when you’re not attached and you don’t have own a house.” Soon after he visited, Lesse rented his first building in Ann Arbor and opened his first gallery, which also became his apartment.

The store is well-known for pieces made using the mokume gane metalworking technique, a layering process originally used to create samurai swords hundreds of years ago. The store sells the work of five of the top artists in the country who specialize in mocha mokume – “mocha” referring to the color of the jewelry. For those looking for a less expensive version of the mokume jewelry, the store offers jewelry made using the Damascus technique, which has a similar look but a lower price tag. 

In general, items in the store range from $20 for pre-made pieces to as much as $20,000 for high-end custom work. They work within a customer’s budget when crafting one-of-a-kind pieces, so prices vary.

In addition to mokume jewelry, the business sets itself apart by using alternative metals like palladium, as well as exclusively recycled and conflict-free stones. This ensures that the stones are ethically mined, which means that the land isn’t disturbed and workers are paid and treated appropriately, Lesse said. It also ensures that money earned from diamond sales has not been used to fund illegal activities.

“This is a choice any jeweler could have made all along, but we were one of the first to do it,” said Katherine Lesse. “There’s no reason to mine fresh stones, to rape the earth, when there are already an abundance of recycled stones.” 

Steven and Katherine Lesse in their store on East Liberty.

The store is also know for its custom-made jewelry. Some of its work has garnered national attention: a women’s ring designed at the gallery and made of diamond and wood was featured in an issue of Vogue magazine.

When The Chronicle asked about the strangest pieces of jewelry he’s ever created, Lesse recounts the one time a woman came in to his store asking him to make a necklace out of her gall stone. “She said that she almost died, but she survived and that the necklace was to be symbolic of her triumph,” said Lesse.

He’s also cast a Doberman puppy’s tail, which he said resembled a rabbit’s foot charm. For his daughter’s birthday, Lesse made a necklace featuring her favorite condiment: hot sauce. Lesse claims he can make jewelry out of almost anything, and encourages customers to bring in their own stones or miscellaneous items that they want made into jewelry.

Despite the weak economy, Lesse says Abracadabra has been busier than ever, growing through customer referrals and word of mouth. “It seems that as the economy has been going down the drain, our business has actually been getting stronger,” he said. “For us, the market always seems to be good and growing.”

There are a lot of jewelers in Ann Arbor, but Lesse says it’s a less competitive market then one might think. “You’re always going to compete, but each jeweler is doing something different, whether it’s custom jewelry or another kind of specialization,” he said. 

Abracadabra has seen inquiries about jewelry sales via their website continue to grow – Lesse says that they receive around one email per day asking about pieces on the site.  

The Lesses have done their own bit for the local economy, by featuring the work of those who have lost a job. Currently the store is selling jewelry made by a man who was laid off from Pfizer. Lesse said it wasn’t until the man lost his job that he realized he had a passion for art. “We feature a lot of our friends, a lot of local artists who are just starting out in the business,” said Lesse. 

Lesse wouldn’t have predicted any of this when he got his first lessons in jewelry-making – he’d be the first to admit that an art career was not his main intention when he signed up for a jewelry class in high school years ago. After finding out from his older sister that the class was almost all girls, he thought it might be a good way score a date with his female classmates. 

Today, he offers a few words of advice to anyone who is trying to decide what direction to go in their life. “You need to do what you’re enthusiastic about, that one thing that you love, because then it’s not work, it’s just what you do.”

Abracadabra Jewelry and Gem Gallery is open Tuesday through Saturday, 11 a.m. to 6 p.m., and Fridays from 11 a.m. to 8 p.m. The shop is closed Sundays and Mondays. The Ann Arbor Art Fairs are the busiest time of the year for the Lesses and their staff, but afterwards they take a break by closing the shop until Aug. 18.

About the writer: Alex Nicola-Iott, an intern with The Ann Arbor Chronicle, is studying journalism and business at Indiana University. He’s spending this summer with his family in Ann Arbor. 

Stephen J. Gill

The current economic crisis is no time for Ann Arbor area nonprofits to hunker down. Whether social services, health care, arts, education or advocacy, nonprofits should use this time to re-examine themselves, ask themselves the tough questions, and develop a culture of learning that will result in long-term effectiveness and sustainability.

Local nonprofits have been hit hard by the economy. Less corporate money is going to United Way of Washtenaw County (the checking account for local nonprofits) and fewer dollars are being generated by endowments at the Ann Arbor Area Community Foundation (the savings account for local nonprofits). The money earned by our community’s philanthropies that then goes to nonprofits is off by 30% to 40%.

Workers earning less or laid off from good paying jobs are not donating as much to United Way, AAACF, or directly to any of the 800 to 900 nonprofits in Washtenaw County. County government has proposed cutting $700,000 from the annual budget for nonprofits as a way of closing its projected $26 million deficit over the next two years. And the state is delaying and, in some cases, cutting its promised payments to social service providers.

At the same time, the demand for the services of nonprofits is increasing dramatically. One example out of many is Food Gatherers, which has experienced a 50% increase in demand for its food rescue and distribution services over the past two years. Some people who had donated to the organization in the past are now using food pantries themselves. In addition to food, there is increasing demand on nonprofits for housing, clothing, affordable health care, psychological support, employment counseling, education, and job placement. The needs are increasing but the money to provide these services is decreasing and funding will probably not recover to past levels for many years to come.

Everyone should be concerned. The Ann Arbor area, as well as the state of Michigan, will not see its economy turn around without effective nonprofits. Nonprofits have a huge impact on the local economy; nationally they account for 5% to 10% of the economy. In Ann Arbor and Ypsilanti that number is probably higher, given that the largest employers are nonprofit organizations. Nonprofits contribute directly to the economy by employing people and by purchasing local products and services. They contribute to the development of new businesses by providing support to entrepreneurs. And they contribute to the quality of life by creating opportunities for all people to participate in the life of the community and advocating for issues and programs that are essential to a civil society.

The initial reaction of nonprofits in this economy has been to try to continue what they’ve been doing but with less staff and less space.  What they should be doing is learning how they can be more effective as organizations and learning how to learn from these challenging circumstances. Nonprofit organizations, now more than ever, must learn to use their limited resources wisely, efficiently and possibly in new and different ways.

An example of this is HelpSource, a human services agency that several years ago was struggling to survive financially but was able to disperse all of its programs to other agencies in the county, after it made the difficult decision to discontinue operations. Having a noble mission is the place to start, but it is not sufficient to stay in business. Another example is the Childcare Network, an Ann Arbor agency that works with communities to develop quality care for children, which recently held a Community Stakeholders Day to learn from others how to best serve the community, build financial sustainability, and generate new revenue streams.

Today, nonprofits need to be continuously learning. The pace of change is too fast to try to stand still. They must constantly be evaluating themselves and using this information to improve performance. This can’t be only at an annual retreat or when there are problems. They should be learning all the time, particularly from their successes. They need to create a culture of learning that supports and encourages evaluation and collective discovery, sharing, and application of knowledge. In this kind of culture, people are continuously applying their collective wisdom to current and future challenges.

About the writer: Stephen J. Gill, Ph.D. is author of the new book, “Developing a Learning Culture in Nonprofit Organizations,” published by Sage Publications. He is chair of the board of trustees for Washtenaw Community College.

A sampling of the questions and ideas generated from a recent meeting of Main Street businesses, who gathered to discuss the concept of a Business Improvement Zone for that area. (Photo by the writer.)

About a dozen business owners, managers and others from the Main Street area gathered last Thursday morning at Conor O’Neill’s to talk about an idea being floated for that district – a self-taxing entity called a business improvement zone, or BIZ. It’s a way to pay for services – things like snow or litter removal, or flowerbeds – to make the district more attractive and bring more shoppers downtown.

This isn’t the first time we’ve encountered the Main Street BIZ. In April, the Downtown Development Authority awarded $83,270 to the group – spearheaded by Ellie Serras and Ed Shaffran – to help get it going. Since then, Main Street BIZ has hired a consultant – Betsy Jackson of The Urban Agenda – and is holding meetings with stakeholders to pitch the idea and get feedback.

That’s what was happening on Thursday. The meeting was one of three planned so far: Earlier in the week, organizers met with property owners of buildings along a three-block stretch of Main Street, where the district is proposed. And on Tuesday, June 30, they’ve scheduled a similar presentation for residents and others who patronize Main Street area businesses. That meeting starts at 6 p.m., also at Conor O’Neill’s.

What’s a BIZ?

Michigan law allows property owners within a specified district to tax themselves, with the funds designated for economic development purposes within that district. The proposed Main Street BIZ would stretch from the south side of Huron to the north side of William, and would include a “wrap” down Washington and Liberty on both sides of Main, running to (but not including) the alleys.

Betsy Jackson, the consultant hired for this project, walked The Chronicle through the process required to set up a BIZ – organizers have already taken initial steps, including setting up a nonprofit and forming a transitional board. Next, they’ll need to get 30% of property owners to sign a petition stating their intent to form a BIZ. (That 30% is based on a formula which gives weight to a vote based on the value of an owner’s property. That is, they could reach the 30% mark without getting 30% of the individual property owners. Additionally, there’s a maximum weight of 25% for any one individual.)

After the petition is filed, the city schedules a public meeting of property owners, who will vote on a detailed business plan for the BIZ. The business plan specifies exactly what the collected funds can be used for. (After the BIZ is approved, it would require another vote to spend the money on services not covered by those categories. For example, if snow removal isn’t initially designated as a category for the BIZ funds, then the district can’t spend the money on snow removal.) The business plan would also give details about a budget, frequency of services, a formula for assessment, governance structure and other information.

At the public meeting, if a majority of property owners approve the business plan, then the city schedules a public hearing within 45 days, and the city council votes on the plan. If council approves it, an election is set. The election is administered by the city via mailed ballots. This time, 60% approval is needed – and again, the votes are weighted based on the value of the property. If 60% or more votes approve the BIZ, then all property owners within the district will be assessed, with the exceptions of  nonprofit property owners (like religious organizations or the university), government properties and owner-occupied housing units. The BIZ requires renewal every seven years.

Why Form a BIZ?

At Thursday’s meeting, Ellie Serras said some of the Main Street property owners decided they needed more control over the district’s future. “We want to make this good thing even better,” said Serras, the long-time executive director of the Main Street Area Association who stepped down from the post last year. Her husband, Dennis Serras, is a partner with Mainstreet Ventures, which owns several restaurants in Ann Arbor, including Palio, Gratzi, Real Seafood Co., The Chop House and La Dolce Vita – all operating on Main Street.

Five property owners got this project off the ground: Ed Shaffran of Shaffran Companies, Rob Spears of Cabrio Properties Amvest Properties, Mike Martin of First Martin Corp., Jeffrey Harshe of MAV Development and Jim Curtis of Curtis Commercial. Each of them contributed $5,000 to the effort, which will be repaid from BIZ funds if the entity is formed. They are also part of a transitional board – other board members are Alan Freedman of Four Directions, and Ron Dankert of Swisher Commercial. Keith Orr of the Downtown Development Authority board (and co-owner of the \aut\BAR and Common Language Bookstore in Kerrytown) is a tentative board member. If the BIZ is formed, property owners in the district would elect a new board at their first annual meeting. The city’s mayor would also be entitled to appoint one board member.

In addition to forming a board, organizers plan to use the DDA grant to set up office space, do website design and cover administrative costs, Serras said.

Jackson said that BIZ districts are typically set up in response to dwindling public sector resources. Business districts have special needs that aren’t necessarily covered by the city’s general fund – standard “common denominator” services aren’t sufficient, she said. Downtown shops and restaurants can’t compete on price with big box stores and malls, Jackson added, but what they can offer is a distinctive, positive experience and ambiance – that’s their competitive edge.

Organizers have identified three potential categories for which BIZ funds could be earmarked, Jackson said, though these could change based on feedback. All of them are aimed at improving people’s perception of the Main Street business district – they are the first things people encounter, she said. The potential categories are 1) snow removal from sidewalks and curb cuts, 2) sidewalk cleaning and litter removal, and 3) landscaping/maintenance.

Questions and Concerns

After a presentation by Serras and Jackson, they opened the floor for questions – and there were many. Several people expressed concern that Ann Arbor city council would not provide basic services if they knew that Main Street BIZ had the money to pay for them instead. Jim Beuche, an attorney with Hooper Hathaway who’s doing work for the BIZ, said that while city council is hard to predict, they “can’t foist off more on us than they will on everyone else.” That said, the reality is that the council defines what services are provided in the city, Beuche said, and those can change at any time.

This prompted Newcombe Clark, president of the Main Street Area Association board, to say: “If you pay more for a cabin on the Titanic, you’ll still sink like everyone else.”

Serras responded by saying that the city can – and has – been pulling back services for the past decade. When the city decided to stop taking care of flowerbeds downtown, the Main Street Area Association stepped in to pay for that, she said. A few years ago, the South State Street merchants paid for security because the city removed its beat cops, she said – a scenario that’s playing out again. Having the BIZ in place would make it possible to respond when the city changes its service levels. (Clark later reminded the group that Ann Arbor’s beat cops would no longer be patrolling, as of this week.)

Derek Davis, marketing manager for The Melting Pot restaurant on South Main, wondered how expensive this would be for his business. The Melting Pot pays rent, he said – would the BIZ mean that their rent will be raised?

At this point it’s unclear how much the property owners will be assessed, Jackson said. The business plan would have to specify the formula used to calculate an assessment, likely based on a property’s value and perhaps its streetfront footage. But the BIZ has no authority to prevent landlords from passing along the costs to their tenants, she added.

Davis noted that some landlords do take care of services like sidewalk snow-shoveling and flowerbeds. But for the building his restaurant rents, he said they have to pay for that kind of thing themselves. It sounded to him like within the organization of the BIZ, tenants had little power.

The issue of tenant power came up again in a discussion of the BIZ board, which would be elected by property owners and include one mayoral appointee. Several people suggested that the board include at least one business owner/tenant, to give that group a voice.

Parking was another issue raised during the discussion. Caroline Kaganov, general manager of Conor O’Neill’s and a Main Street Area Association board member, joked that she feels she’s been working for the city – she’d spent the past four days helping people figure out how to use the new parking meters installed downtown. She said the perception is that parking is scarce. Davis said there was plenty of parking, but there needed to be ways to lower the price. Perhaps the BIZ could subsidize customer parking for businesses that can’t afford to comp it on their own, he suggested.

Some people were concerned because alleys aren’t going to be included within the BIZ district – that’s where a lot of the problems are, they said, citing litter and snow removal.

Angela Pierro of Zero Gravity Designs said aesthetics were important, like putting in flowerbeds and cleaning up cigarette butts. She also said sidewalks need to be in better shape – uneven sidewalks, which cause little kids to trip or which make it difficult to push strollers – deter families from wanting to come downtown.

Davis said that in general he felt the city was very safe, but the biggest security complaint he heard from customers related to panhandling. Being approached by panhandlers affects the perception of whether Ann Arbor is a family friendly place, he said.

Next Steps

The goal would be to have a BIZ assessment on the July 2010 tax bills, Jackson said. That means they’d need to have a draft of the BIZ plan adopted by the board and start circulating petitions in September, she said. They hoped to have enough signed petitions to submit to the city clerk in October.

Meanwhile, they’ll be gathering information about similar zones in other cities. More outreach efforts are planned, too, including a website (to be designed by Angela Pierro of Zero Gravity Designs) and online survey to get more feedback about what services the district needs. They’re also working with the city attorney’s office and city clerk to ensure that all the proper steps are taken, since the city hasn’t done anything like this before. “We want to make sure there are no hold-ups related to process,” Jackson said.

David Babcock and Ed Koster act out a scene from the play "Hellcab" at Ann Arbor Civic Theatre auditions earlier this month. The show will be performed Aug. 21-23. (Photo by the writer.)

The woman is swaying in her seat, inhaling in a drunken hiss and dragging her feet along the floor. The driver stares straight ahead, looking mildly uncomfortable.

Grinning, her head wobbling slightly on her neck, she leans as far forward as possible and whispers loudly to the cabbie, “I looove you!”
The other people in the room – and the director, Paul Bianchi – laugh.

The woman and the man acting as the cabbie are seated in two chairs in the middle of the Ann Arbor Civic Theatre studio in downtown Ann Arbor – a high-ceilinged, mostly empty room with a wood-paneled floor and a piano at one end. It’s an evening in early June, and they’re auditioning for “Hellcab,” a play depicting a day in the life of a Chicago cab driver.

A day in the life of AACT itself is challenging in a different way. Like virtually all nonprofits, including those in the performing arts, the local theater faces some less-than-entertaining concerns this season. Although leaders of the theater say it isn’t in crisis, the nonprofit has made some cuts to save money, and is trying to get creative about ways to bring in revenue.

Performing Well, Despite the Economy

Overall, AACT has been “pretty lucky,” said Suzi Peterson, the theater’s managing director. They don’t depend heavily on grants for funding, which has helped, since that source has dried up somewhat as funders face their own financial struggles. And donations from individuals are on the rise. In fact, the theater’s membership and individual giving is higher than it’s been for the past several years, Peterson said. Membership giving and donations account for $20,000 of the past season’s $200,000 budget. Peterson said that’s roughly 20% more than last year and quadruple what it was in the year 2000.

“That sort of income is doing pretty well,” she said. “Our donors have been really supportive.”

However, corporate donations aren’t as strong. “It’s going to be a lot tougher this coming season,” Peterson said. “Companies just don’t want to let go of their money.”

Corporate donations accounted for about $50,000 of funding for the theater’s last season. That amount has stayed steady in recent years, but theater staff expects that it may drop next season. Corporate and individual donations (including grants, which Peterson said vary) make up 40% of the theater’s funding. The remaining 60% comes from ticket sales. Ticket sales have decreased somewhat, but they’re holding fairly steady. Peterson attributes this to AACT’s move to reduce prices last summer. “I think because of that, people were more able to afford seeing one of our shows,” she said.

Ann Arbor Civic Theatre isn’t alone in facing fallout from a struggling economy. Another local theater, Performance Network, announced in April that it needed $40,000 or it would close – an appeal that resulted in a rush of donations. Peterson said the Civic Theatre didn’t notice any impact from that situation – that is, it didn’t appear that donors shifted funding from their theater to Performance Network. And Civic Theatre workers wanted Performance Network to pull through. ”We’re all sort of in this – the arts business – together,” Peterson said.

As for sending out financial alerts of its own, Peterson said she didn’t recall ever doing that, although they have faced tough times in the past. ”We’ve had some lean years,” she said. “And we’ve definitely had some emergency meetings trying to figure out what to do.”

Final results aren’t yet in for the theater’s current fiscal year, which ends June 30. The theater’s main stage season (which includes large productions at the Lydia Mendelssohn and Arthur Miller theaters on the University of Michigan campus) runs from September to June. The studio series, which involves smaller productions, takes place in July and August.

Although the theater isn’t facing any financial crisis at the moment, Peterson said the staff has still enacted cost-cutting measures “just in case” there’s a drop in funds next season. Their goal is to turn out productions of the same quality for less money.

A little over half of their $200,000 budget is used for productions, and the rest goes to overhead. AACT doesn’t own the buildings it uses, so it has to pay rent. And there are salaries for its workers. The theater employs five paid workers. Two of them – including Peterson – work half-time. The others work only a few hours a week, Peterson said.

Advertising is one “really expensive” area that has been cut, Peterson said. The theater is looking for alternative, free ways to spread the word about their work, such as creating a Facebook page and further expanding the theater’s online presence.

They also save money on costumes by not buying new ones for each show. “Instead of buying costumes that we need, we have several volunteers that build new costumes themselves,” Peterson said. AACT maintains a costume shop – located in the same building as the theater’s studio at 322 W. Ann St. – where costumes used in productions over the years are saved for future use. Although they don’t keep all of their costumes because of space constraints, Peterson explained that they hold onto “really unique” ones. For example, they’ve kept some heavily beaded gowns that took hours of labor to create. They also keep costumes that were made for specific animals or characters in their productions. “There are some it feels like we reuse every year,” she said.

The theater also recycles props and wood and materials from its sets. “We’re just trying to find ways to build sets economically,” Peterson said.

Using email and the internet instead of paper to communicate with its donors and audience is another way that the theater saves money, since printing is expensive, Peterson said.

The one thing they don’t want to cut is their performances. “We don’t want to cut the number of productions we do because they’re important,” Peterson said. The past season included 13 productions: 6 main stage, 2 junior theater and 5 studio series. That’s 2 more productions than the previous year, which Peterson said is a response to more people wanting to direct shows.

Season tickets for the Civic Theatre’s next season are currently on sale, and Peterson said the budget for the next season is in place. And although they’ve made cuts just to be safe, she noted that the theater has seen a good response for next season already.

Actress and AACT board member Kathleen Beardmore expressed optimism for the upcoming season. “I just feel really good about this upcoming season and its ability to draw a variety of audiences,” she said.

Beardmore, who was on the play selection committee for the season, explained that this year’s lineup includes some well-known pieces – like “The Producers” – that are bound to draw people in. She said the selection of shows also represents a variety of themes, from lighter to more serious. “We’ve got a nice variety,” Beardmore said. “I think that gives us a chance to draw an audience from a variety of directions.”

In terms of cost-cutting measures, Beardmore said that the board looked at “both sides of the equation” – expenses and revenue. She agreed that the theater wants to preserve its wide variety of quality programming. “I think we have to be careful about not cutting too deep,” she said. “We don’t want to cut so deep that we change the essence of the organization.”

Instead, the theater is trying to focus on individual donors. Beardmore said AACT is fine-tuning its message to remind people of what they personally get out of the organization.

Second, the theater is looking to events other than shows for fundraising. They recently held a wine-tasting, for example. “We don’t have to just do things that center on performance,” Beardmore said.

Finding Value in the Arts

Peterson said she’s aware that several local arts organizations, including University Musical Society, are still waiting on grant money from the state that they may never get. “There’s a part of me as a private citizen, I understand the state is just in awful shape,” Peterson said. “But I don’t like the idea that the arts is the first to get cut.”

Following the “Hellcab” audition, Paul Bianchi spoke to The Chronicle and echoed Peterson’s sentiments about the importance of funding for the arts. Cutting arts funding from the state is “penny wise, pound foolish,” he said. “That’s seed money that grows.” He explained that many other businesses – such as restaurants and parking facilities – profit from cultural activities.

Peterson emphasized that theater and the arts play a vital role in the community in other ways. One of the ways the theater specifically impacts Ann Arbor is by exposing children to the arts through its junior theater program. “We’ve seen so many kids come into the program…not really knowing what the arts are,” she said. Those same kids come out of the program with not only a better understanding of the arts but more self-esteem and confidence from being onstage, Peterson said.

But a trip to the theater isn’t just good for kids. Many of AACT’s patrons have problems in their lives with finances or family or both. When they come to see a performance, they can spend two hours and “not have a care in the world,” Peterson said. She described the theater as having the ability to “lift you away from your struggles,” if only for a few hours.

Sha James, one of the actors at the “Hellcab” audition, said the theater offers a unique opportunity by bringing together people of all ages and ethnic backgrounds. “If anything needs funding, I think it’s the arts,” James said. “Where else could I go and meet so many other different people?”

David Babcock, who also auditioned for the play, agreed that people should still make funding the arts a priority in hard times. “I know that it’s tough for everybody,” Babcock said. “But if people are regular givers to the theater, they should try to budget that in.”

Besides donating money, community members can help out the theater by volunteering. Whether it’s helping to sort out costumes or working backstage, there are many ways to contribute, Beardmore said. The theater has supporters and members from all walks of life and all professions, which Beardmore identified as one of its “greatest assets.”

“We have to keep a place in our world, as we face hard economic times, for the arts,” Beardmore said. “The arts are often where you’re seeing innovation, and if we don’t need that in our community, what do we need?”

Overall, Peterson said she’s nervous about the theater’s future but feels that it will pull through. After all, it’s already survived 81 years.

“We made it through this long. We’ve just got to stay hopeful,” Peterson said. “We have no idea what this next season is going to hold.”

About the writer: Helen Nevius, a student at Eastern Michigan University, is an intern with The Ann Arbor Chronicle.

Maria Thompson, general manager of the advanced research and government solutions group for A123Systems in Ann Arbor. She was one of several panelists from the local business community at Monday's UM economic development forum.

More than 250 people from academia, business, government and nonprofits packed the auditorium Monday afternoon at the Partnership for an Innovation Economy forum, hosted by the University of Michigan at its newly renovated art museum.

Throughout the two-hour event, The Chronicle learned, among other things: 1) which former Pfizer executive is a rugby referee, 2) which local power couples have relied on each other for advice, 3) who hosts one of the best holiday parties in Ann Arbor.

Of course, there was also much talk of UM’s role in economic development.

Steve Forrest, UM’s vice president for research, kicked off the forum by saying how deeply committed the university is to economic development. The event was a follow-up to a similar session they held about 18 months ago, he said, bringing together people in the community and within UM to talk about ways to partner. One of the results of those conversations is the launch of UM’s Innovation Economy website, he said. The idea is to provide a portal into all of the many university resources and programs that businesses can tap.

Forrest outlined trends in the Great Lakes economy – like the fact that manufacturing is no longer an economic driver. The region has to “get out of the mindset of denial,” he said, acknowledge that traditional manufacturing will never return, and transform quickly into a knowledge economy. Opportunities abound, he said, particularly in advanced auto manufacturing, green energy, health care and drug discovery.

UM is poised to take advantage of those opportunities, with its research expenditures pushing $1 billion this year, he said. “We have the resources. We have the talent.” What they don’t have, he added, is stable support from the state. Michigan lags all other states in its funding for higher education, and the university foresees that trend continuing. [UM president Mary Sue Coleman, along with leaders from other state universities, will be making their case for increased funding on Friday in testimony before the Senate Appropriations Subcommittee on Higher Education. The session, which is open to the public, begins at 10 a.m. in the Michigan League's Vandenberg Room, 911 N. University Ave., Ann Arbor.]

The solution to these challenges requires that all sectors of the economy – academics, industry, government and nonprofits – work together, Forrest said. He said they must use their regional strengths to compete on a global, not local, stage. He quoted Coleman, who in a 2006 speech to the National Press Club said that the university must “partner or perish.”

Forrest mentioned several efforts already underway: the Michigan Initiative for Innovation and Entrepreneurship, a consortium of the state’s public universities; UM’s own push to make entrepreneurship and working with industry a cultural value in their academic community; and the UM Business Engagement Center, designed to facilitate relationships between UM and industry.

They aren’t too big to fail, Forrest concluded. “We live in times of scary opportunities. They’re ours to miss.”

University Panel

Marvin Parnes, UM associate vice president for research and executive director of research administration, moderated the first of two panels, a group of five UM administrators whose work related to partnerships with industry. Daryl Weinert, executive director of UM’s Business Engagement Center, described BEC’s role as being advocates for the relationship between companies and academics. Within the past fiscal year, nearly 200 companies have come to the university for the first time seeking partnerships, he said – there’s pent-up demand, ranging from entrepreneurs in their garage to Fortune 500 companies. It can be difficult to work with small companies, he said, so they’ve been experimenting with different programs. Those include internships and career fairs focused on small businesses, as well as a small company innovation program, which gives financial incentives to small businesses to collaborate with UM on research projects.

Ken Nisbet, left, executive director of UM's Office of Technology Transfer, next to Steve Kunkel, senior associate dean for research at UM's Medical School.

Marian Krzyzowski, director of UM’s Institute for Research on Labor, Employment, and the Economy, talked about two programs at the institute: the Community Economic Adjustment Program (CEAP), and a program that provides customized business assistance to Michigan firms. Ypsilanti is one of the areas getting help from CEAP, which is participating in the Eastern Leaders Group project to revitalize that part of Washtenaw County.

Elaine Brock, senior associate director for UM’s Division of Research Development and Administration, said the university is trying to improve industry’s access to faculty. “We know that’s a concern,” she said. “It’s a big place, with way too many doors.”

Ken Nisbet, executive director of the Office of Technology Transfer, said the most effective forms of tech transfer are students. “I encourage you – go off and hire a student today,” he quipped. He ticked through the performance of the office: in fiscal 2008, they processed more than 300 invention disclosures, 91 licenses and other agreements with industry, 13 startup companies using UM technology, and they brought in more than $25 million in revenues from royalties and equity sales. They work with partners like Ann Arbor SPARK, MichBio, various chambers of commerce, Detroit Renaissance and others, he said. “We’re all in this together – we’re all committed to making Michigan a better place.”

The final speaker for this panel was Steve Kunkel, senior associate dean for research at UM’s Medical School. He praised the university’s decision to “plunk $108 million on the table” to buy the Pfizer research campus on Ann Arbor’s north side, and said they were in the due diligence stage, hoping to close the deal in mid-June. [That was roughly the same timeframe given earlier this year at a UM town hall meeting about the site.] Kunkel said they were figuring out how to use the space, trying to come up with a revolutionary way to conduct research. A committee is focused on innovation, he said, which might include moving the College of Engineering’s Center for Entrepreneurship to the site, and possibly setting up a business incubator there. Later in the forum, he said they hoped to make 3,000 new hires in the next 10 years at the site, and to bring in international partners. It’s “an opportunity not to do the same old thing,” he said.

Stephen Rapundalo, left, an Ann Arbor City Council member and president of MichBio, talks with state Rep. Ed Clemente before the start of Monday's forum. Clemente, who represents the 14th District, chairs the House New Economy Committee.

Business Panel

Rich Sheridan – CEO of Menlo Innovations, which throws one of the best holiday parties in Ann Arbor, Parnes told the audience – moderated the second panel. The four panelists gave perspectives from outside the university: Ed Krause, external alliances manager for Ford Motor Co.;  Maria Thompson, general manager of the advanced research and government solutions group for A123Systems in Ann Arbor; Mike Finney, CEO of Ann Arbor SPARK; and Ed Clemente, state representative for the 14th District and chair of the House New Economy Committee.

Krause, a Saline resident, said that the Ford/UM Innovation Alliance, launched in 2006, started out as a primarily technical endeavor but has expanded dramatically. Even though they don’t bring in the kind of research funding that the federal government does, he said they’ve always been treated like a partner of equal value.

There are some ways to improve, Krause noted: 1) industry experience should play a greater role in the hiring and tenuring of faculty, 2) industry research should have a higher value in the tenure process, and 3) administrators should encourage faculty to take sabbaticals in industry.

Maria Thompson said the university is a lot easier for businesses to navigate now than it was when she and her husband, Levi Thompson – a UM chemical engineering professor – started their business in the early 1990s. But it’s always been a place of great resources, she said. Thompson said their business – formerly T/J Technologies, which is now a division of A123Systems – used interns from UM’s Zell-Lurie Institute for Entrepreneurial Studies to help write business plans, and other students to work on market research.

Thompson also said people in Ann Arbor have been willing to support each other – she and Levi have consulted with other couples who’ve started businesses together, like Heidi and Chuck Jacobus of Cybernet Systems, and in turn they’ve done the same for younger entrepreneurs like Michelle and Aaron Crumm of Adaptive Materials. She encouraged people attending on Monday to stay for the reception that followed the forum, saying it was important to take advantage of these kinds of networking opportunities.

Mike Finney, CEO of Ann Arbor SPARK.

Mike Finney, CEO of the economic development agency Ann Arbor SPARK, recalled one of his own ties to UM – president Mary Sue Coleman had called him when he was being recruited for this job, he said. It worked.

Finney said SPARK is really a regional marketing organization, trying to sell the Ann Arbor area to businesses who might want to locate here. He said that two-thirds of the projects they’ve worked on to bring businesses to this area have had very direct connections to UM. He’s able to pick up the phone and call people at UM, who’ll help provide connections to these businesses through faculty, staff or alumni. His peers doing economic development in other regions don’t have that kind of access, he said.

Referring to a comment by Daryl Weinert earlier in the forum, Finney said that when the university gets 200 businesses calling the Business Engagement Center, he salivates – that’s 200 prospects that Ann Arbor SPARK doesn’t have to find. He said one way for UM to improve would be for the university to reach out to his counterparts throughout the state, and play an even greater role in the resurgence of the state’s economy.

The final panelist to speak was Ed Clemente, a state representative from the 14th District, which includes part of Wayne County. Clemente told of his own recent Pfizer connection – he’d been playing rugby last weekend at Riverside Park in Ann Arbor and ran into David Canter, former head of the local Pfizer campus and now director of healthcare research at UM’s William Davidson Institute, who is a rugby referee.

Clemente, who chairs the House New Economy Committee, said that everyone’s looking for a silver bullet to fix the state’s economy, but in reality, incremental growth is the way that change will occur. The state needs to create an environment conducive to innovation, he said, noting that Michigan is going to be great again, “it’s just going to be very different.”

After the presentation, panelists took questions from the audience. Here’s a sampling:

• What other kinds of coordination should UM be doing? Maria Thompson said having one-stop shopping is important, because entrepreneurs are so busy dealing with their business that they need to get information efficiently. Ed Krause of Ford suggested having a more coordinated approach to partner with industry and go after federal stimulus funding.
• What new approaches is UM taking to manage intellectual property? What’s being done to address the high cost of working with the university? What can be done to create more urgency on UM projects? Elaine Brock said it’s important to recognize that the university is a university, not industry. That said, “we are listening” to concerns, she said. As for cost, she said that the university operates on a cost-reimbursement model, but they don’t make a profit. Ed Krause advised businesses not to hire the university for contract engineering, but that when your business wants to try something new, UM brings the kind of equipment and expertise that you can’t find elsewhere. Ken Nisbet said UM has seen a sea-change in responsiveness to industry, but they can always be better. “We’re really trying.”
• How can we overcome the lack of strategic planning in Lansing? Saying that he didn’t really have a good answer, Ed Clemente suggested that individuals need to press state legislators on both sides of the aisle to make changes. Legislators will listen, he said, as long as you don’t yell. He said it doesn’t help to simply talk to Ann Arbor legislators – you need to reach out to other lawmakers, too.

As the forum wrapped up, Forrest said he’d taken notes about some of the suggestions that had been offered about ways that UM can improve its relationship with the business community. “We’ll keep doing this,” he said. “We are very dedicated to doing this.”

The forum included more than an hour of networking in the UM Museum of Art lobby. Consider this The Chronicle's version of "Where's Waldo," where Waldo in this case is city councilmember Christopher Taylor.