Friday, June 27, 2014

Is Grand Rapids regulating the sharing economy too strictly?

Recently Time Magazine included Grand Rapids in a list of cities they believed were “attacking” the sharing economy. The sharing economy, for those not in the know, is the increasingly popular practice of individual people renting out their “stuff” for cash. Before internet sites were developed to connect people who need particular items with people who have particular items, the average person either borrowed whatever he needed from friends or neighbors, went to a rental shop, bought it outright, or went without. But as websites connecting people proliferated, and the economy tanked, people found their willingness to rent out their spare bedroom for a weekend, their car for a trip to the airport, or an antique necklace for a wedding increased - as long as the rental fee was worth their while. Renters decided they were willing to take perhaps a bigger risk of renting from a stranger if the price was low enough.

Websites that have thrived using this new person-to-person model include Uber, Lyft, Airbnb, Snapgoods (now relaunched as Simplist), and many more. There are a number of built-in problems with this business model, however. Risk is higher, even if businesses cover the losses of the occasional bad-faith renter or provider. Liability is, of course, greater with unbonded, unlicensed, unregulated service providers. One personal injury lawsuit can erase years of diligently made earnings. And, perhaps more importantly, the low overhead required for service providers to enter the market makes them a threat to businesses that operate more traditionally.

Now services that specialize in offering rooms, rides, and equipment cheaper are facing pushback from established businesses or industries or even cities. This is similar to the conflict between food trucks and restaurants seen in Grand Rapids, with restaurant owners pressuring the city to limit the scope of the food trucks’ operations so their bottom line would not suffer.

Unable to compete for lowest price because the cost of following burdensome government and union regulations is so high, businesses have turned to government to demand these new sharing services be either made illegal or be made subject to the same regulations they must follow.

Grand Rapids is only one of a number of cities that have had to grapple with this problem. And as of June 12, the city’s planning commission has voted 4-3 to support regulations that limit Airbnb operators to one-room rentals of only two adult guests. They must also be licensed and the city will only issue 200 such permits to allow for Airbnb accommodations. The city will also notify neighbors when a permit is given.

Whether this is “attacking” the sharing economy depends on your opinion. There is a price to be paid for safety and dependability, but the rapid growth of sharing businesses suggests it may be too high.

Tuesday, June 24, 2014

Is sex trafficking a serious problem in West Michigan?

There has been a surplus of strange sex crimes in the news in the last few days.

Shawn James Jarrett was arraigned in Grandville District Court Monday for first-degree home invasion and first-degree criminal sexual conduct. He is accused of entering an elderly lady's house on false premises, then assaulting her and stealing an unstated amount of money and bicycling away. In a similar crime, he murdered a 64-year-old woman in 1983 and served 30 years in prison for that crime. He was released in 2012, and authorities considered him dangerous enough to warn his community that he would be living among them now. Sadly he wound up here and police now consider him a suspect in the murder of Yolanda Reyes, a woman who went missing in April and whose body was found last month at a construction site.

As disturbing as that is, Shawn Jarrett seems to be a violent individual who is likely never to see freedom again. Judge Peter Versluis denied Jarrett bail yesterday and remanded him back to the Kent County Jail.

More troubling is the idea that a system for human trafficking has been set up in the area and functions to funnel the vulnerable to the predatory. Nicole DiDonato reported Monday on this "hidden crisis," asserting that, according to experts, thousands of minors are sold right in our own communities: " West Michigan alone, there are 2,400 minors for sale at any given time, mostly on the internet."

For those who scoff at the idea, look to other news headlines. This morning Mlive reported that Douglas Davalos Jackson was arrested for the human trafficking of a 15-year-old girl whom he intended to sell to other men. He was also charged with criminal sexual conduct and the felony use of a firearm.

And last week radio host John Balyo was arrested on the suspicion of child-sex assault and has admitted to assaulting at least one 12-year-old boy whom he paid Ronald Moser to procure. His arrest Friday at a Christian music festival was a result of a federal investigation.  He was being held on a $500,000 bail bond, but that has since been revoked. His two previous employers, Christian radio station, WCSG, and the Kent County Traffic Squad have since disassociated themselves from him.

The fact is there are large numbers of children and teens in Kent County whose home lives are chaotic and unsupervised enough for predators to have easy access to them. How many hours after school is the average middle schooler unattended? How many kids wander the streets looking for something to do all summer? All of those kids are at increased risked to be exploited. And, sadly, in our modern sex-obsessed society, it's not unsurprising that there are plenty of people who will exploit them. Some communities have more safeguards in place to help protect their children, but others do not. How can we make sure that people in our community are not being trafficked?

Tuesday, June 17, 2014

Keith Allard answers small business questions

Thursday night Graydon’s Crossing hosted a town hall meeting for Keith Allard, candidate for state representative for Michigan’s 76th district in Grand Rapids. The restaurant’s upper room was full of a variety of people who showed up to hear Allard speak and answer questions from the crowd.

Allard’s focus was on limiting government, ending crony capitalism, and enforcing the same standards across the board for all parties, not just those with connections. When he opened the discussion up for questions, many of those who attended wanted to know about small business topics, as well as his positions on taxation, the role of government, and keeping politicians accountable to the people they represent.

A number of people in the crowd seemed quite concerned about governmental overreach, a topic that has been on the minds of many during the past months when the news has been full of stories about the implementation of the Affordable Care Act, the IRS’s targeting of conservative groups, and NSA spying. Allard brought up his own experience working in government in Lansing as opposed to working in the private sector (and owning a small business) and stated that the profit incentives that drive businesses to work hard, succeed, and innovate, are not present in government, and the accountability of government workers to the public is indirect at best.

Allard made a point of stating a clear preference for across-the-board standards for big and small business so as not to penalize the average Joe with regulations not enforced for those with money and influence. He also said that one of his key goals as a representative would be to reform the prison system, where spending remains much higher than comparable states.
When questioned about corroding infrastructure and commonly used state and municipal assets such as Michigan’s infamous roads, he stated that, the money saved by cutting back on prison spending could easily be spent on roads, and if it had been spent on roads a decade ago we would not have our road problems today. It is simpler and cheaper to maintain assets than it is to replace them, Allard said.

Keith Allard will be on the ballot for the August 5th primary election.

Thursday, June 12, 2014

The Grand Rapids food truck controversy

Food trucks are coming to Downtown this summer and will be offering their food experiences at Wege Plaza, adjacent to Rosa Parks Circle. The city approved the Grand Rapids Art Museum’s request for a permit to allow food trucks outside their premises, and the trucks have already been serving food there since the end of April.

Food truck cuisine has been somewhat scarce in Grand Rapids, despite all the growth, change, and new social opportunities downtown. Many restaurateurs vigorously opposed the Planning Commission’s approval of food trucks back in 2012. They felt that food trucks had the unfair advantage of significantly lowered overhead costs and would take business away from brick-and-mortar restaurants downtown. The city temporarily sided with restaurant owners, ruling that food trucks could operate only when parked on private property. This had a dampening effect on food truck initiative as it severely limited the scope of where they might operate.

Others, including Rick DeVos, argued that food trucks and restaurants are the apples and oranges of dine-out eating, not truly comparable, and that greater competition will result in better food choices for Grand Rapidians overall. The food truck experience, at least at present, is more serendipitous, dependent on good weather and the right timing, and the menu is limited. You like what they are serving or you don’t. Some GR food trucks don’t even have websites, just social media platforms on Facebook or Twitter.

Food enthusiasts have been waiting impatiently for food truck options partly because the entrepreneurs who take on the food truck challenge tend to offer a varied menu with an emphasis on local and sustainably grown ingredients. A glance at A Moveable Feast’s menu reveals items like the Crispy Quinoa Burger and Southwestern Fish Tacos made from these ingredients: Lake Michigan whitefish, cilantro-lime red cabbage slaw, flour tortilla, and chipotle aioli. The food is vegetarian-friendly with a number of soups and sides suitable for any palette. The people of Grand Rapids were enthused enough about this possibility to fund A Moveable Feast’s start-up costs through Kickstarter this spring.

Another option is What the Truck, an offshoot of The Winchester restaurant, with the mission of “bringing better street food to Grand Rapids, Michigan.” Focusing on burritos and tacos instead of sandwiches, What the Truck is also at the GRAM this summer as well as elsewhere around the city including at the Fulton Farmer’s Market, dishing out a unique menu highlighting meat and produce from the area. They have a breakfast and a lunch menu.

While restaurants and food trucks will compete with each other, it doesn’t have to be a lose-lose situation. Pat Flynn, owner of Foodtruckr, a food truck industy resource website says, “As a small business owner myself, I appreciate the struggles of my fellow entrepreneurs in all industries, online and offline. The restaurant industry is particularly challenging. As a former architect whose number one desire was to design restaurants, I know first hand just how strenuous this business can be. I root for restaurant owners and their businesses. I also root for food truck owners. Food truck owners share the same passion and determination as restaurant owners. And I've come to admire the resilience and creativity that food truck owners possess in this competitive and innovative marketplace. I believe that type of healthy competition is good for everyone. And I believe that like-minded entrepreneurs should band together, especially when they devote themselves to the happiness of a common customer base. In the end, delighting customers with scrumptious meals is what matters. Restaurants and food trucks both have valuable roles to play. I believe in abundance, not scarcity. I believe that the world is a better place with both restaurants and food trucks. My stomach seems to agree with me!”

This summer we will see whether food trucks are a significant challenger to brick-and-mortar restaurants in Grand Rapids and whether vigorous competition inspires improvement in our local food scene.

Saturday, June 7, 2014

Why the good news for Michigan manufacturing not salvation for the average Joe

The second week of this month, May, was Michigan Manufacturing Week. Former governor, John Engler, was recently quoted as stating that Michigan manufacturing is “on the mend.” This sounds like great news for all of us in Michigan and in Kent County who have been holding out hope that the glory years of plentiful jobs and generous benefits might return some day to our fair state.

Business experts and economists have begun to be cautiously optimistic that Michigan, in recession for over a decade, is making strides towards growth and improvement. This is the third year in a row that manufacturers in Michigan have expanded and added jobs. 13,084 jobs were added just in 2013, and there are more than 662,000 people in various manufacturing sectors across the state.

From the standpoint of the historical manufacturing worker in Michigan, however, the increase in jobs available does not translate to more work for him right now. Many of the new jobs are in high tech areas, requiring degrees in STEM (Science, Technology, Engineering and Medicine) fields. Jay Baron, of the Center for Automotive Research said recently, "In Michigan we have a fairly high unemployment rate, yet there are a lot of for-hire signs at these companies," he said. "They need technical-skilled people; technicians who can fix machines when they break down, computer programmers and other sorts of positions."

If you have a smart son and daughter who will be entering college and is math or science inclined, there is some real opportunity for them as well as a reason to remain in state after college. But Michigan’s former prosperity was built on the availability of jobs that the average person, at least one with a good back and decent work ethic, could do.

In 1960 a high school graduate could easily find work he could support a family with, and the money made from those jobs “trickled down” to other jobs created out of the need to spend the excess income of the time. Money from the auto industry indirectly funded teachers, dentists, home builders, restaurateurs, Motown singers, and professional athletes and kept a lot of people fed and housed, clothed and cared for.

In 2013, after years of educators, politicians, and government officials pushing higher education as a ladder out of poverty, only a little over third of Michigan residents (38.7%) had a two or four-year college degree and only a fraction of those degrees were in STEM fields. What’s more, the average graduate of a four-year college or university had $28,840 in student loan debt to pay off and a real lack of possibilities of how to pay those loans off, given that the market for jobs that pay well enough to produce the excess needed to pay off debt is already glutted and shrinking. Essentially, despite any progress made over the last fifty years, and despite the fact that the unemployment rate in Kent County is the lowest in the state, no one can now graduate from high school and get a job that pays enough to support a family now. And by the time young people acquire enough education to get that job, they’ve also acquired enough debt to put off investments in life like marrying, having children, and buying a home.

In the long term, the technical jobs of today will benefit, to some extent, the average worker. Discoveries made and products developed by research and development departments will create more work over time. But the trend among large companies and manufacturers has been and continues to be automation of jobs once done by people. These decisions are not made entirely out of greed, either. With more global competition and future entitlement liabilities, U.S. companies have to keep their costs down to compete.

So what about the average Michigan worker or the one here in Grand Rapids? For now it looks like he’s caught between a rock and a hard place and is faced with a far less secure future unless he can somehow lever himself into a job in demand. This is actually much more in line with American reality before the post-War industrial boom. We would do well to look back at the strategies our ancestors had for economic survival and success - hard work, thrift, cooperation, and pragmatism.

Wednesday, June 4, 2014

The Riverside Elementary redesign moves forward into assisted living

The Riverside Elementary redevelopment project appears finally to be moving forward, after a long series of delays. The city’s Brownfield Redevelopment Authority approved the project for tax breaks on Thursday, June 5, 2014. Vista Springs, LLC estimates it will cost them $6 million to redevelop the property.

Lou J. Andriotti, President and CEO of Vista Springs told Mlive he plans to turn the 60-year old former public elementary into a 43-unit luxury assisted living facility. The retirement center will focus on health and wellness and will feature a day spa, a performing arts community theater, a community center, fine dining, and an outdoor courtyard and cafe. Rates for occupants will vary according to how much assistance residents will require.

The idea of conversion was first proposed by G.A. Haan, a Harbor Springs development company, in early 2012. At that time, the Creston Neighborhood Association gathered a concerned group of Riverside Gardens neighbors to discuss what Gerald Haan’s plans were and how they would affect the neighborhood. Some neighbors reported break ins that had occurred in homes surrounding the now vacant school. Others were concerned about the potential for additional noise or light that might come from a converted building. Many agreed that an assisted living facility was one of the best possible converted uses, much more likely to be disruptive to the calm neighborhood than apartment complex would be.

Since that meeting, however, the building has continued to sit vacant, and the neighbors wondered if anything would ever be done about it. Last winter at least eight windows were smashed, and it appeared that the building might have been broken into, perhaps repeatedly. These windows were boarded over, but glass remained in the grass, which was only mowed occasionally (as in the winter it had been plowed).

It’s unclear as to why G. A. Haan passed on the project or why it sold the property to Vista Springs last winter when only a year ago it received the go ahead from Brownfield Redevelopment Authority itself. But neighbors are excited to see some project and hopeful that a functional and well maintained building will add more vibrancy to the neighborhood, along with the 50 new jobs Vista Springs estimates it will produce.

It’s interesting to note that Vista Springs has previously converted another former Grand Rapids public school, Taft Elementary into an assisted living retirement center. Many of these elementary schools were built to accommodate the needs of a burgeoning generation, the Baby Boomers, in their formative years. Some of them will now shelter them in their retirement. Everything comes full circle, it seems.