Clayton & McKervey: “R&E tax credit is a ‘smart’ incentive for Industry 4.0 companies to improve financial performance”

Southfield, Mich.—December 13, 2018—Automation continues to revolutionize the economy, but many thriving companies are not utilizing federal and state tax credits and incentives in the area of research and development that support Industry 4.0 adoption and growth, according to Clayton & McKervey, an international certified public accounting and business advisory firm located in metro Detroit. Sarah Russell, CPA, a Clayton & McKervey shareholder who advises clients on Research & Experimentation tax strategies, believes there has never been a better opportunity for businesses—including “smart” manufacturers—to explore and capitalize on these cash savings.

“Real-time data, combined with an understanding of the impact of tax credits and incentives, can often make a business more nimble and competitive,” Russell said. “The Research & Experimentation (R&E) tax credit, also known as the R&D tax credit, has given businesses a powerful tool to strategically improve their bottom line, but it is often overlooked or unclaimed—even with the new tax law.”

The R&E benefit is available for the development or improvement of products, processes, techniques, formulas, inventions or software and is a dollar-for-dollar credit against the taxpayer’s federal income tax liability, which means companies may get a twofold benefit—the deduction in the year the expenditure is paid, as well as by claiming the tax credit.

Tim Finerty, CPA, a Clayton & McKervey shareholder who addresses the needs of growth-driven businesses in the manufacturing, system integrator, distribution and service related industries, says that some of the best candidates for the R&E tax credit are companies that have business related to technology, industrial production and design, but also some machine shops, tool and die shops, and custom machine manufacturers.

“S-corporations, start-ups and partnerships in the business of improving industrial production processes through controls, automation or system integration should definitely consider the R&E tax credit,” Finerty said, “but many of these businesses are thinking about converting to a C-Corp structure under the new tax law.”

Before a change in structure, Finerty cautions that additional factors should be considered like whether the business qualifies for the pass-through deduction; if the business generates research credits; whether the business will pay dividends to its owners; and the long-term exit strategy of the business.

“The answer lies in the way the tax law is written,” Finerty said. “R&E credits generated by a business can be used to offset any income generated from that same business activity, so converting to a C-Corp may not be the best solution.”

Russell and Finerty outline examples of Qualified Research Activities (QRAs) under the R&E credit:
• Providing custom control and automation solutions for various applications
• Developing new functionality or performance to meet customer specifications
• Development of schematic drawings for integration of system components
• Designing and developing cost-effective and innovative operational processes
• Developing new tool-specific fixturing or other tooling
• Improving processes through robotics or other types of automation techniques
• Experimenting with new alloys or other materials
• Testing new mold/die designs through sampling or trial
• Providing product and system solutions, including design engineering and mechanical fabrication
• Performing evaluations and system test
• Implementation of automated systems

There may also be Qualified Research Expenditures (QREs) if companies can substantiate how the expenditures are connected to the qualified activities including:
• Qualified Wages of Employees performing qualified activities, supervising qualified activities and supporting qualified activities
• Supplies used to fabricate prototypes/items consumed during the conduct of research
• Contract Research–65 percent of fees paid to outside consultants/subcontractors/ engineers/software developers
• Estimates are allowed, however documentation of how the estimates were determined must be provided and reasonable methods must be used

Tax savings can be extensive; for example, one Clayton & McKervey client that designs, manufactures and installs purification systems tallied an approximate R&E tax credit of $1 million for 2014-17; another client who manufactures and installs integrated cleaning solutions for industrial applications will get a $475,000 in an R&E tax credit. Other examples of companies benfitting from the R&E tax credit are a designer and manufacturer of custom container and packaging products that saved almost a half-million dollars and a company that designs and builds custom conveyor systems that saved $1.4 million over three years.

“It’s definitely worth it for companies, especially those who have moved forward with an Industry 4.0 approach, to take a second look at its qualified research activites to make sure it’s receiving all the money it can,” Russell said.

About Clayton & McKervey
Clayton & McKervey is a full-service certified public accounting and business advisory firm helping closely held businesses compete in the global marketplace. The firm is headquartered in metro Detroit and services clients throughout the world. To learn more, visit


Legislative Update: Business Issues On the Chamber’s Lame Duck Agenda

As the state Legislature wraps up a whirlwind session before the holidays, take a look at some of the bills moving quickly supported by the Detroit Regional Chamber and that impact businesses in the Detroit region.

Regulatory Climate
Minimum wage and paid medical leave:
Last week, the state Legislature adopted two bills revising the previously adopted minimum wage and paid medical leave citizen initiatives. The revisions to the minimum wage will require the wage to reach $12.05 until 2030, compared to $12 by 2022 as originally adopted, and eliminates the new language regarding tipped employees. Revisions to paid medical leave include a small business exemption for employers with fewer than 50 employees and an amendment to the amount of annual paid medical leave required by qualifying businesses to 40 hours versus the 72 hours originally adopted. The Chamber supports the amendments to these initiatives in order to maintain Michigan’s competitive business environment.

Small cell digital communication: Chamber-supported legislation (SB 637 and SB 894) seeking to create a new, standardized regulatory scheme for small cell wireless facilities in both urban and rural communities passed the Legislature and were sent to Gov. Snyder. This new regulatory framework will incentivize infrastructure investment, build out the state’s broadband connectivity, and address needs for emerging next-generation mobility technology.

Tax Environment
Federal and state tax decoupling
: The Chamber is in support of legislation (SB 1097) that will decouple the state’s definition of taxable income from the Internal Revenue Code and revert to the definition prior to the passage of the new federal statute. This legislation passed the Senate and is currently being considered by the House of Representatives.

Detroit city income tax bills – Legislation to modify the City Income Tax Act (HB 4618) and the Revenue Act (HB 5025) to provide new city income tax collection procedures for the City of Detroit and the Michigan Department of Treasury are moving through the Legislature. HB 4618 was sent to the Governor and HB 5025 is currently being considered in the Senate after passing the House of Representatives. Both bills will assist in increasing the collection of city income tax revenue in Detroit.

Tax on pass-through businesses – The Chamber supports legislation permitting business entities to elect into a pass-through entity tax which would shift state tax liabilities from individuals to the business entity (SB 1170). This would allowfor full deduction of state and local taxes at the federal level. This legislation has unanimously passed the Senate and is currently being considered by the House of Representatives.

Teacher preparation: Legislation aimed at improving teacher training in Michigan (HB 5598560256035604 and 5605) passed the House last week and is awaiting action in the Senate. This package of bills is aimed at teacher preparation including teaching college reform, the creation of a master teacher corps., and the requirement that student teaching hours include time spent in schools with high poverty, ESL learners and individuals with disabilities. The Chamber was a key supporter of this legislation earlier this year.

A-F Schools: The Chamber has been longstanding supporter of letter grades for school buildings. Recently introduced legislation (HB 5526) provides multiple letter grades in the following areas: proficiency, growth, growth of ESL students, graduation rate, absenteeism and participation. This much-needed reform provides transparency and clarity for parents and the community about the performance of local schools. This legislation was recently passed in the House and the Chamber is working with the Senate to get it to the governor’s desk before Christmas. 

Weight Watchers Reimagined: WW Named December Member of the Month

Longtime Detroit Regional Chamber member, Farmington Hills-based WW, previously known as Weight Watchers, was chosen as the Member of the Month for December because of its recent effort to broaden the role the company plays in helping individuals live healthier lives. The Member of the Month is awarded to Chamber members that are working to uplift Southeast Michigan.

Florine Mark is the president and CEO of The WW Group Inc, the leading WW franchise in the U.S, housed in Michigan. Mark is a multi-faceted entrepreneur who embodies WW’s mission of inspiring healthy habits among people and communities. While her name and the name of her business is synonymous with weight loss, Mark’s work extends far beyond that. From her contributions to health and nutrition, women and cultural concerns, business and entrepreneurship, and charitable and community revitalization, Mark has left her mark regionally and on a national level.

WW has followed in Mark’s footsteps by taking steps to expand its reach beyond weight loss programs. This change is part of a broader strategy to help individuals reach their health goals by following scientifically proven methods. From eating healthier to moving more and developing a positive mindset, WW is crafting health experiences that cast a broad net on health-related challenges everyone experiences.

One critical component of this strategy is Connect Groups, a new way to strengthen WW’s community and help foster relationships that inspire healthy habits. In the WW app, members can join a group by connecting with individuals like them based on several categories including: food (gluten-free, vegetarian, etc.), life stages (college students, new moms, etc.) and activities (yoga, running, swimming etc.).

This Member of the Month designation is especially timely with the approach of the holiday season. The holidays can prove a difficult time for conquering health hurdles. WW offers a membership that encourages individuals to stay healthy throughout the year, getting them through the holiday season and continuing past the inevitable fitness boom in January and February. WW’s mission is to help individuals achieve their health-related goals for a healthier community.

To learn more about WW’s evolution, visit the website.

Dickinson Wright Attorneys Work Recognized as Midwest Region Deal of the Year by The Bond Buyer

DETROIT, Mich., December 12, 2018 – Dickinson Wright PLLC is pleased to announce that The Bond Buyer, a national publication covering municipal finance, selected the Michigan Finance Authority’s issuance of bonds ($288.6 Million) to finance the acquisition, construction and equipping of the Wayne County Jail and Justice Center Complex as the “Midwest Region Deal of the Year for 2018”. Dickinson Wright Attorneys Kester K. So and Peter Kulick and legal assistant Andrea Golladay served as bond counsel to the Michigan Finance Authority on the bond issue.

The 2018 Awards Ceremony was held on December 6, 2018 in New York and considered deals that closed between October 2, 2017 and September 28, 2018. It drew nominations throughout the nation for transactions ranging in size from a few million to billions of dollars. One finalist was selected from each of the five regions covered by The Bond Buyer. The entries were evaluated by The Bond Buyer’s editors and bureau chiefs. They looked for deals that involved innovation, the ability to pull complex transactions together under challenging conditions, deals that could or did serve as a model for other financings, and the public purpose for which a transaction’s proceeds were used.

The proceeds of the bonds funded a portion of Wayne County’s contribution to the new criminal justice center. The security for the bonds utilized a new and innovative financing structure including a limited tax general obligation pledge of the County and an intercept of state aid payments to the County—one of the first county intercepts used in Michigan. The structure enabled Wayne County to access the public markets successfully for the first time since 2010.

Dickinson Wright’s municipal law and finance practice consists of a team of lawyers with a national reputation as one of Michigan’s top bond counsels. Our lawyers have served as bond counsel in virtually every type of public financing transaction. Additionally, the team acts as underwriter’s counsel, trustee’s counsel, counsel to credit enhancement providers, counsel to purchasers of municipal bonds and borrower’s counsel in connection with all types of tax exempt and tax credit bond financings. Our lawyers have been recognized by both Best Lawyers in America and Super Lawyers in the areas of municipal law and finance.

About Dickinson Wright PLLC
Dickinson Wright PLLC is a general practice business law firm with more than 475 attorneys among more than 40 practice areas and 16 industry groups. Headquartered in Detroit and founded in 1878, the firm has 19 offices, including six in Michigan (Detroit, Troy, Ann Arbor, Lansing, Grand Rapids, and Saginaw) and 12 other domestic offices in Austin and El Paso, Texas; Columbus, Ohio; Ft. Lauderdale, Fla.; Lexington, Ky.; Nashville and Music Row, Tenn.; Las Vegas and Reno, Nev.; Phoenix, Ariz.; Silicon Valley, Calif.; and Washington, D.C. The firm’s Canadian office is located in Toronto.

Dickinson Wright offers our clients a distinctive combination of superb client service, exceptional quality, value for fees, industry expertise and business acumen. As one of the few law firms with ISO/IEC 27001:2013 certification, Dickinson Wright has built state-of-the-art, independently-verified risk management controls and security processes for our commercial transactions. Dickinson Wright lawyers are known for delivering commercially-oriented advice on sophisticated transactions and have a remarkable record of wins in high-stakes litigation. Dickinson Wright lawyers are regularly cited for their expertise and experience by Chambers, Best Lawyers, Super Lawyers, and other leading independent law firm evaluating organizations.

Butzel Long attorney Beth Gotthelf’s passion for Defense Industry trade missions with Israel a win-win for Michigan and Israel businesses – Law firm participates in December Michigan/ Israel Defense Delegation

DETROIT, Mich. – Butzel Long attorney and shareholder Beth S. Gotthelf is a visionary who spearheaded the first-ever trade mission of Israeli Defense companies to a state, which has now led to the first-ever trade mission by a state of defense companies to Israel. As a result, Michigan and Israel defense companies are reaping the benefit.

Recently, Butzel Long participated in a five-day trade mission to Israel coordinated by the Michigan Israel Business Accelerator (MIBA), the Michigan Economic Development Corporation (MEDC), MEDC Defense Center, and Macomb County. The mission was in cooperation with the State of Israel Minister of Defense, SIBAT International Defense Cooperation (SIBAT). The goal of the mission is to expand export opportunities; meet with potential buyers; and, promote Michigan’s leadership role in the defense sector. The Right Place, a regional non-profit economic development organization, based in Grand Rapids, also participated.

“The recent trade mission to Israel was extremely valuable in establishing relationships with potential partner companies in Israel, and also creating new Michigan relationships,” said Jim Kendall, President & CEO, Cignys in Saginaw. “Two new connections could quickly result in new business, which from a timing standpoint, certainly exceeded my expectations of the mission. “Beth Gotthelf is to be commended for her foresight to drive the mission and encourage my participation. It was well worth the investment and I look forward to the development of long-term relationships and business with Israeli partners.”

“There are vast opportunities for Michigan to partner with Israeli defense businesses,” said Vicky Rad, Deputy Director Macomb County Planning and Economic Development. “Due to programs under the Foreign Military Funds (FMF), many businesses, both large and small are seeking to engage the U.S. market. This trade mission has helped us educate them on the defense assets we have here in Macomb County and throughout our state.”

Notably, SIBAT wanted Michigan to be the first state SIBAT hosted in Israel for a defense mission, added Gotthelf, Director of Innovation and External Relations and Chair of Butzel Long’s Aerospace and Defense Industry Team and a MIBA Board member. “The mission to Israel just concluded with more business opportunities for both Michigan and Israel companies.”

According to Gene Sorgi, President, Challenger Communications, LLC in Albion and Jill Reschke, Challenger’s Director of Sales and Marketing, the opportunity to meet with the right people at the largest Israeli defense companies to discuss providing satellite antennas, support and replacement parts is invaluable.

“The opportunity to travel to Israel with the Michigan delegation was a great opportunity for RAMI,” said Robert Payne, General Manager, RAMI in Grand Haven. “The ability to meet with leaders at SIBAT and leading Israeli defense companies will be invaluable as RAMI looks to further expand into the Israeli and international markets. We are looking forward to continuing to develop the friendship we formed while in Israel.”

Meanwhile, Gotthelf stated that SIBAT has had trade missions in the past, but only with other countries. Her vision was for a trade mission to Michigan. She approached SIBAT who at first had no interest. Working with the MEDC, the Defense Center and Macomb County, Gotthelf spent 18 months, including two visits to Israel, convincing, then planning and hosting the 2017 trade mission to Michigan. At the time, Gotthelf also served as the President of the Michigan Israel Business Bridge (MIBB) — now the Michigan Israel Business Accelerator (MIBA).

The 2017 trade mission to Michigan was successful in netting business opportunities. However, importantly, it garnered key attention to Michigan as a major defense center. Macomb County is a hub of Michigan’s defense industry, anchored by the U.S. Army’s Tank Automotive Research, Development and Engineering Center (TARDEC) and Tank-automotive and Armaments Command.

“The Michigan Israel conference was a success,” said Amira Ilany, SIBAT European and North American Division Director, based in Tel Aviv, Israel. “Beth Gotthelf’s initiative of this event, planning all the details of the schedule and executing it was all together a whole new concept that needs to be duplicated again. I use this event as an example of a successful business-to-business experience. Exposure of the Israeli defense companies to professional end users in Michigan and to defense companies as well, was an unprecedented event. Our defense representatives from the Israeli defense companies were very pleased.”

“There is more opportunity than ever for Michigan and Israel-based companies, from mature organizations to start-ups, to collaborate,” added Gotthelf.

About Butzel Long

Butzel Long is one of the leading law firms in Michigan and the United States. It was founded in Detroit in 1854 and has provided trusted client service for more than 160 years. Butzel’s full-service law offices are located in Detroit, Bloomfield Hills, Lansing and Ann Arbor, Mich.; New York, NY; and, Washington, D.C., as well as alliance offices in Beijing and Shanghai. It is an active member of Lex Mundi, a global association of 160 independent law firms. Learn more by visiting or follow Butzel Long on Twitter:

Detroit Business Community Better Off Following Eight Years of Gov. Snyder’s Leadership

As Michigan Gov. Rick Snyder prepares to leave office on Jan. 1, it is hard to argue the fact that Detroit and Southeast Michigan aren’t better off than they were eight years ago. Consider this: Michigan has gone from 50 out of 50 to a Top 10 state for job creation, investment dollars and people are coming back to Detroit, the city has become a national hub for automotive IT and the rapidly evolving financial technology sector, state unemployment is the lowest its been in a decade, and the economic forecast for business growth is showing a positive upward trend.

According to the U.S. Bureau of Labor Statistics, the Detroit region’s labor force is up 6.2 percent, employment is up 15.9 percent, and per capita income is up 34.2 percent since Snyder took office.

This comeback is due in large part to the Governor’s bipartisan leadership embodied by a deep sense of morality to do right by the people of Detroit and Michigan and his trademark “relentless positive action” attitude that has helped bring key decision-makers to the table on everything from Detroit’s bankruptcy to the Gordie Howe International Bridge construction.

Here is a look at the top 5 ways the Governor has helped strengthen our city and region’s ability to compete in the 21st century.

Brokering the Grand Bargain and Detroit’s Exit From Bankruptcy

Arguably one of the most challenging times in the city and state’s history, Gov. Snyder was a key voice and stalwart leader throughout Detroit’s historic bankruptcy. Setting partisan politics aside, the Governor worked with lawmakers, community groups, the business and nonprofit community, and other key players to ensure the best possible outcome for the city’s future.

Signing the Grand Bargain into law helped lay the foundation to accelerate Detroit’s renaissance. Since that time, the city has transformed faster than many even thought possible. World-class companies like Ford Motor Company, Google, Quicken Loans and Bedrock Detroit, are investing in the city. New startups are growing every day, shaping diverse success for sustained economic growth.

Additionally, the region’s 25- to 34-year-old population has risen by 9.7 percent the past five years, the second highest growth among peers — outpacing the national average by 4.2 percent.

Listen to the Governor talk about the Grand Bargain during the 2014 Mackinac Policy Conference.

Bringing the Gordie Howe International Bridge to Fruition

Recognizing that Detroit is the busiest commercial land border crossing and an important trade and transportation route between Canada and the United States, Gov. Snyder was a key partner in helping to secure funding and support for the construction of the Gordie Howe International Bridge from top decision-makers, including Canadian Prime Minister Justin Trudeau.

Snyder worked with lawmakers to help forge a deal in which Canada is paying to build the bridge and the U.S. customs plaza. Slated to open in 2024, the new bridge will help strengthen jobs and businesses on both sides of the border.

“… It’s not just about business, it’s the opportunity to ride bikes, to build cultural ties and educational opportunities. This bridge truly is another great connection between our countries that will only cement a relationship that has gone on for a couple hundred years already and will make it stronger and better,” Snyder said during the bridge construction kickoff.

Investing in Detroit’s Youth Through Detroit Promise

At a time when businesses and residents were leaving Detroit following the Great Recession, Gov. Snyder recognized the importance of investing in its future citizens, announcing the launch of the Detroit Promise in 2011, which guarantees two years of higher education or post-high school vocational training for all Detroit students who graduate high school.

Recognizing the success of the Detroit Regional Chamber in running the Detroit Compact, a four-year tuition assistance program between public and private universities and Detroit Public Schools, the Governor tapped the Chamber to administer the Detroit Promise on behalf of the Michigan Education Excellence Foundation.

Since that time, the program has expanded to include more than 650 students in 19 colleges and universities and more than 2,700 students in six community colleges. Funding for the Promise also expanded with the support of Mayor Mike Duggan and the creation of the city’s Detroit Promise Zone in 2015, which dedicates a portion of tax dollars to permanently fund two-year scholarships.

Strengthening Michigan’s Automotive and Next-Generation Mobility Leadership

Under the Governor’s watch, Michigan continued to strengthen its leadership and investment in automotive ingenuity and next-generation mobility innovation. As the first state to adopt comprehensive legislation aimed at making it easier for automakers to test autonomous vehicles on public roads without a driver, lawmakers worked on a bipartisan manner to ensure Michigan remains on the leading edge of a global effort to redefine the future of transportation.

A self-described “nerd,” the Governor was a critical enabler of the Mcity autonomous vehicle testing center in Ann Arbor and American Center for Mobility in Ypsilanti.

During the 2016 Mackinac Policy Conference, the Governor launched the state’s PlanetM initiative, elevating Detroit and Michigan as a hub for mobility innovation.

“Michigan has always been the automotive industry leader, and as the transportation industry evolves, our state’s influence will continue to shape the way the world moves,” Snyder said.

By aligning all of Michigan’s autonomous and connected vehicle technology assets under one banner, the Governor took the message that Detroit is open for business to the international automotive and startup community, hosting numerous business development missions overseas with the Michigan Economic Development Corp. and the Chamber to promote more economic development and growth in the state.

The Governor’s support for the industry has led to multiple MOUs with foreign countries including Australia, Canada, China, the Netherlands and United Kingdom to strengthen cooperation in CAV (connected autonomous vehicle) development.

An Unwavering Champion of Civility

Through Detroit’s ups and downs, the Governor’s call for “relentless positive action” and “leading through civility” has not faltered. And in some ways, it has served as a rallying cry for Detroit and the region’s economic prosperity.

Recognizing that civility in discourse is crucial to solving problems, the Governor has repeatedly called for citizens and lawmakers to listen and embrace others’ opinions to find common ground on challenges that impact all Michiganders.

“Michigan can show the world how we can disagree without being disagreeable, how we can debate without personal attacks, and how we can solve more problems together than we can apart,” Snyder said.

Reaching out to the business community, the Governor published an op-ed in The Detroit News with 220 business leaders calling for civility in 2018 and again made it a key focus during his final keynote address at the 2018 Mackinac Policy Conference.

In his gubernatorial exit interview with the Detroit Economic Club, the Governor warned that the lack of civility in discourse today is the No. 1 threat to our state and nation’s collective future.

From road funding to education reform, job creation, and services to help the middle class, Snyder says compromise must come first.

The business community couldn’t agree more.

Thank you, Gov. Snyder for eight years of leadership, resolve and relentless positive action that has put our city, region and state on the path toward a brighter future for all.

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Reduction in waste sent to landfills
Conservation of natural resources, such as metals and minerals
Helps prevent pollution by reducing the need to collect new, raw materials
Saves energy
Reduces greenhouse gas emissions that contribute to global climate change
Helps sustain the environment for future generations
Helps create new, well-paying jobs in the recycling and manufacturing industries in the United States
Once the materials are recycled they can be reused in making new products

Starfish Family Services Selected as a Crain’s Detroit Business ‘Best-Managed Nonprofit”

Starfish Family Services building master record system to consolidate client data
by Sherri Welch

Data is key to helping nonprofits measure and communicate their impact and to making strategic decisions about where best to invest scarce resources. But it’s not always easy to figure out how to measure intangible things like a child’s well-being, overall development and likelihood of succeeding in college. The co-winners of the 2018 Best-Managed Nonprofit contest are doing exactly that.

This year, judges chose to lift up both a larger-budget nonprofit and a smaller nonprofit for the steps they are taking to get their arms around their data and use it in meaningful ways to better meet their missions.

Midnight Golf has launched two new data systems over the past year. One is aimed at keeping track of the growing number of high school seniors and college students it’s supporting. The other helps track its donors and their interests, while also providing a source of internship possibilities for the students it serves. Starfish Family Services is bringing data from over 20 disparate systems into a single system that will provide a more complete view of all of the programs a child or family it serves is receiving, along with indicators of how those clients are doing overall.

Both efforts are aimed at finding the best ways to help those they serve. Crain’s will honor the two organizations in late February during its annual Newsmaker of the Year lunch.


  • It’s committed $2 million, 3-5 years to develop and roll out the new system
  • Will eliminate duplication, provide holistic view of children and family success
  • Expected to produce $2.5 million in cost savings, new revenue

One of Starfish Family Services’ core strengths is its ability to serve children and families through a variety of  early childhood, children’s mental health and family support programs. But that same breadth of service has also been its Achilles’ heel. Information on the clients in each of its programs lives in different, siloed systems. That creates stress and frustration for parents who are asked to provide the same information over and over again. And it prevents Starfish staff from linking things like a young child’s behavioral issues in the classroom with stress happening at home due to a pending foreclosure, something communicated to the agency by the child’s mom through a separate Starfish program.

“We end up with 20 different data systems we’re putting information in” on who’s served and their outcomes, President and CEO Ann Kalass said. “If we’re looking at the whole child … we want to be able to see everything (they) are getting from us in early childhood, in Head Start and mental health services,” she said.

“We may have a hypothesis that a combination of programs creates better outcomes … but we can’t prove it
until the data is linked.”

Starfish has set out to tackle the complex issue by bringing data from all of the disparate systems into a single, master record system that will enable it to see all of the programs a child or family is receiving through the agency, success indicators across them and family relationships. That, in turn, will enable it to better identify causative factors and gaps in service. It’s committed $2 million and three to five years to develop and roll out the new, child and family master record system, a data warehouse that will enable it to report out data to funders and dashboards to track sets of data.

Starfish, which is operating on a $46 million budget for fiscal 2019, is funding the costs of the
new system from its reserves and unrestricted operating funds. It expects to more than recoup its investment by the time it’s fully rolled out the new system in 2022.

“We see this as an investment in something we have to do in order to achieve our mission and
our family-centric view,” Kalass said. “As a sector, to have the impact we want, we need capacity investments that make our programs work.”

First and foremost, the goal with the new, master record system is to improve services to families and to make it easier for staff to provide those services, said Kirsten Mack, director of value acceleration. Starfish has contracted with Boulder, Colorado-based Global Data Strategy Ltd. to develop the new child master record system. It’s spent the past year and a half establishing data governance to ensure all data entered across the nonprofit and its programs will be consistent.

That includes everything from who will enter data and be able to access data to how it will be structured, Mack said. For example, it might mean designating someone’s race as “white,” for example, vs. “Caucasian,” or using numerical birth dates rather than spelling out months so that the system can read all data.

Starfish is also working to establish an organization wide data warehouse where it can report out on all of the data from the disparate systems. All of the data from the master record system gets put into the warehouse.

“That’s how we can see holistic data … and report out on it,” Mack said.

The agency has entered its first set of data, behavioral health information, into the data warehouse and is producing weekly updates that track completion of required documentation for clients or progress toward targets for clients through “dashboards” or visual representations of data that Mack and her team liken to a car’s instrument panel. The gas gauge, for example, might show progress toward an enrollment target for the number of children in an early childhood education program on a dashboard, she said. Staff are notified of weekly dashboard updates by email and can log into the system to access the latest progress reports. Data governance and the data warehouse will form the foundation for establishing the child and family master record.

“Our plan is by this time next year to have the master record system launched,” Mack said.

From that point, it’s expected to take another one to three years to be fully implemented where data is entered into the master system and pushed out to the other funder systems for reporting purposes.

Just a year and a half in to development of the new system, Starfish is already seeing cost savings as it changes how it manages data. The automation of some data management led to the elimination of one full-time position that’s expected to save about $100,000 a year, Kalass said.

More efficient data entry is also freeing staff up to spend more time working with clients, and that’s increased billable revenue, Mack said. And the weekly dashboard updates on required behavioral health documentation has increased the number of claims paid, which is starting to produce more revenue on that front. By the time the new system is fully online in 2022, cost savings and increased revenue from the more efficient system are projected to add up to $2.5 million, Mack said.

Author and Placemaker Jay Pitter to Keynote 2019 Detroit Policy Conference

Renowned author and placemaker, Jay Pitter, will keynote the 2019 Detroit Policy Conference on Thursday, Feb. 28. Pitter will share a vision for creating a more inclusive city where individual voices are heard, civic engagement is strong, and urban development creates an enhanced quality of life for all.

With a focus on mitigating the growing divide in urban centers, Pitter draws from her personal experience and spearheads projects focused on cultural heritage interpretive planning, gender-based mapping, inclusive public engagement, safe streets, and economically challenged communities.

The 2019 Conference will bring together national and local thought leaders to share their insights on the future of Detroit. By asking impactful questions focused on confronting key issues for growth and inclusion, the 2019 Conference offers attendees a glimpse of what could be Detroit’s bright future. Register for the 2019 Conference here.

Jay Pitter

Jay Pitter, MES, is an author and placemaker whose practice mitigates growing divides in urban centers. She spearheads institutional city-building projects, rooted in neighborhood knowledge, focused on: cultural heritage interpretive planning, gender-based mapping, inclusive public engagement, safe streets, and healing fraught sites.

Creating more inclusive cities is not just a professional mission for Pitter, it is personal. Her city-building values are informed by the long-term mentorship of her second-grade Irish-Canadian teacher who modeled the power of reaching across social divides when she was a child growing up in social housing.

As a result of these rich experiences and international portfolio, Pitter shapes urgent city-building conversations through media platforms such as the Agenda and Canadian Architect — as a keynote speaker for organizations like the UN Women and Massachusetts Institute of Technology (MIT) — and as lecturer and knowledge producer in urban planning faculties across North America.

Recently, Pitter consulted on Edmonton’s new heritage plan; hosted a professional development luncheon for women city-builders in Detroit; shared her placemaking principles with Memphis River Parks Partnership; initiated a safe and connected streets engagement following the mass shooting in Toronto; and led (RE)IMAGINING CHEAPSIDE, a Confederate monument placemaking process in Lexington.