Local Ann Arbor Landlord and Others Who Are Politically-Connected Received Millions in PPP Loans

by P.D. Lesko

In Ann Arbor, 57 businesses received PPP (Paycheck Protection Plan) loans from the U.S. Small Business Administration in amounts between $1 million and $10 million. Only one of the companies, Skysync, Inc., is minority-owned. Two of the companies are woman-owned, Liberty Title, Inc. and Manpower of Southeastern Michigan, Inc. The majority of the largest PPP loan recipients in Ann Arbor were white men. Government records reveal that owners of companies that received large PPP loans in Ann Arbor are also politically-connected men, including Ann Arbor’s Mayor Christopher Taylor, political donor and mega-landlord Jeff Hauptman, and 22nd District Court candidate Nick Roumel.

Jeff Hauptman, who owns Oxford Property Management, received a PPP bailout loan worth $1 million-$2 million in order to retain 72 jobs, according to data released by the U.S. SBA in response to a Freedom of Information request. According to Washtenaw County campaign finance documents, after Hauptman received his PPP loan in April of 2020, he donated thousands to local candidates for City Council endorsed by Mayor Chris Taylor.

State of Michigan campaign finance records show that Hauptman also donated $1,000 to the Inspire Michigan PAC, controlled by Wayne State VP and Detroit Tech Town CEO, Ned Staebler. Staebler lives in Ann Arbor. Using money donated to his PAC, Staebler paid to have mailed thousands of postcards to Ward 1 and 4 voters endorsing Dr. Lisa Disch and Jen Eyer, respectively. Michigan campaign finance disclosures from July 2020 reveal that Staebler also used money from his PAC to pay for Facebook ads opposing Ward 2 incumbent Jane Lumm and Ward 4 incumbent Jack Eaton, and in support of Disch, Eyer and Ward 5 candidate Erica Briggs.

Staebler, who is the CEO of Tech Town, a Detroit-based “job creation” engine, like Ann Arbor SPARK, applied for a PPP loan on behalf of Tech Town, a public-funded entity. [Note: Ann Arbor SPARK did not apply for any PPP funding.] Staebler applied through the Bank of Ann Arbor on behalf of Tech Town, and received a loan worth $350,000-$1,000,000, according to SBA data. On the application, Tech Town officials claimed that the loan would help Tech Town retain 53 jobs. According to Tech Town’s most recent 990 tax form signed by Staebler and filed with the IRS, the non-profit employs 35 people and has net assets exceeding $25 million. According to the same 990, Staebler was paid $139,057 in reportable compensation and $42,900 in other compensation. Between 2015 and 2018, the amount spent on salaries at Tech Town more than doubled from $1 million to $2.1 million. Since 2014, Tech Town has received more than $19.8 million in public support.

According to financial disclosures filed with the State of Michigan, Staebler, through his PAC, spent over $8,000 on a postcard mailer and Facebook ads in order to influence the August 2020 Ann Arbor City Council primary election in favor of the Mayor’s slate of candidates. According to City Council candidate campaign finance disclosures, Staebler also donated $600 directly to Ward 4 candidate, Jen Eyer.

Local attorney David Nacht donated $500 to Staebler’s PAC. Nacht and his law partner Nick Roumel (a candidate for the 22nd District Court) received a PPP loan of $150,000-$300,000 in order to retain 12 jobs. According to the Nacht Law website, the company employs eight attorneys.

Likewise, Hooper Hathaway, which employs Ann Arbor’s mayor as a law partner, and which employs no Black attorneys, applied for and received—through the Bank of Ann Arbor—a PPP loan in the amount of $350,000-$1,000,000 in order to retain 21 jobs. According to the Hooper Hathaway website, the firm employs a dozen attorneys. Taylor donated to the five-member slate of Council candidates whom he also endorsed. Several of Taylor’s partners at Hooper Hathaway have donated to Taylor’s slate of candidates, as well.

Along with Hauptman and Staebler, several of the PPP loan recipients who are white, politically-connected men applied for and received their loans through the Bank of Ann Arbor. Tim Marshall, president of the Bank of Ann Arbor, has served for 15 years on the Board and Executive Committee of Ann Arbor SPARK. Marshall is presently on the Board of the University Musical Society.

The University Musical Society applied for a PPP loan through Board member Marshall’s Bank of Ann Arbor and received funding of $350,000-$1,000,000 to retain 29 jobs. According to the UMS website, the organization employs 37 people. UMS, according to its most recent tax return, is sitting on a $26.8 million fund balance and a little over $1.3 million in liabilities.

According to the UMS’s most recent 990 income tax return, UMS President Matthew VanBesien was paid $227,574 in reportable compensation and $33,766 in other compensation, about $22,000 more than was paid to former long-time UMS president Kenneth Fischer. In comparison, the same 990 tax form shows former UMS CFO John Kennard, Jr. was paid $156,656. UMS hired a woman (Carmen Adrianopoulos) to replace Kennard. Her pay was set $120,034, 23 percent less than was paid to the man in the CFO job before her.

UMS Board members include Ward 2 City Council candidate Linh Song and Rachel Bendit, wife of UM Regent Mark Bernstein. Both Bendit and Bernstein donated $2,000 to Chris Taylor when he ran for Mayor in 2016 and 2018.

Ned Staebler, David Nacht, Nick Roumel and Chris Taylor are not the only politically-connected locals whose companies applied for and received large PPP loans. Former Ward 5 Council member Carsten Hohnke is listed as the Treasurer and Secretary of the Board in state filings of Above the Treeline, an Ann Arbor company. That company applied for and received a $350,000-$1,000,000 loan to retain 27 jobs. The loan was obtained through the Bank of Ann Arbor.

Recycle Ann Arbor, recently awarded a $5 million contract by the City of Ann Arbor to reopen the City’s Materials Recovery Facility (MRF)—so that recycling no longer has to be trucked to a processing facility outside of Ann Arbor—received a PPP loan of $350,000-$1,000,000 in order to retain zero jobs. Recycle Ann Arbor provides an essential service to the City through recycling collections and its services were never interrupted. The non-profit, a subsidiary of the Ann Arbor Ecology Center, declared revenue in excess of $6 million on its most recent 990 U.S. tax return. The organization has a fund balance in excess of $740,000.

Likewise, the Ecology Center applied for and received a PPP loan. The loan of between $150,000-$300,000 was obtained in order to retain 14 jobs. The Ecology Center’s most recent 990 tax form shows revenue in excess of $2.8 million and a fund balance of $1.89 million.

Michael Garfield, who heads the Ecology Center and heads the Board of Recycle Ann Arbor has, in past, endorsed Chris Taylor. The Ecology Center is a member of several local groups that pushed for the passage of the billion dollar A2Zero Carbon Neutrality Plan. The Ecology Center is now among groups pushing a 20-year, $160 million Affordable Housing Millage which will appear on the November 2020 ballot. Twenty percent of the total amount raised by the millage would go toward providing unspecified “services,” perhaps provided by Avalon Housing.

Like Recycle Ann Arbor, and the Ecology Center, Avalon Housing is a recipient of money from the City of Ann Arbor. The nonprofit received a PPP loan of $350,000-$1,000,000 in order to retain 87 jobs.

SBA public records show that the partners in the Zingerman’s community of restaurant businesses applied for PPP loans for as much as $6.9 million in order to retain over 614 jobs total. According to SBA data, in Michigan of the 785 Michigan restaurants approved for more than $150,000 each in PPP loans, only one self-identified as Black-owned.

Zingerman’s Bakehouse and Deli both applied for PPP loans of $1 million-$2 million. The money was awarded to both on April 7, 2020. Zingerman’s Roadhouse, Zingerman’s Service Network, Zingerman’s Coffee Company and Zingerman’s Training all applied for PPP loans that were awarded, according to data released by the U.S. SBA. According to a July 24 piece published on Bridge Magazine, “before the pandemic, the Zingerman’s businesses employed over 500 and generated at least $40 million in revenue.”

Local bank president Stephen Ranzini explained that businesses that applied were, in theory, required to demonstrate an inability to obtain loans or lines of credit via traditional means.

On the public Facebook group Ann Arbor Politics, Ranzini wrote, “For them [Zingerman’s] to have to take a multi-million dollar tax payer funded bailout is shocking. Didn’t they have reserves and lines of credit to support their business through a recession? Couldn’t the wealthy millionaire owners provide financial support to the firm they founded?” When questioned about the loan restrictions, Ranzini added, “The business must be able to assert that they cannot obtain financing elsewhere. If a sufficiently large line of credit is available, it would disqualify the business from receiving these funds. The penalties for false attestations are severe, possibly a felony.”

Current Ward 5 Council member Ali Ramlawi, long-time owner of Jerusalem Gardens, a downtown restaurant, received a PPP loan of between $150,000-$300,000 in order to retain 32 jobs. Ramlawi obtained his loan through Level One Bank, which merged with the former Ann Arbor State Bank.

Below is a list of businesses with owners who have political connections who received large PPP loans. The significant differences in funding awarded versus jobs allegedly retained should be noted.

Oxford Property Management, Jeff Hauptman, Old National Bank, $1,000,000-$2,000,000, 76 jobs

Above the Treeline: Carsten Hohnke, Bank of Ann Arbor, $350,000-$1,000,000, 27 jobs

Avalon Housing: Chelsea State Bank, $350,000-$1,000,000, 87 jobs

First Martin Corporation, Bill Martin, Level One Bank, $350,000-$1,000,000, 22 jobs

Hooper Hathaway, Christopher Taylor, Bank of Ann Arbor, $350,000-$1,000,000, 21 jobs

Recycle Ann Arbor, Level One Bank, $350,000-$1,000,000, 0 jobs

Tech Town, Ned Staebler, Bank of Ann Arbor, $350,000-$1,000,000, 53 jobs

Zingerman’s Deli, Level One Bank, $1,000,000-$2,000,000, 201 jobs

Zingerman’s Bakehouse, Level One Bank, $1,000,000-$2,000,000, 160 jobs

Zingerman’s Roadhouse, Level One Bank, $350,000-$1,000,000, 143 jobs

Zingerman’s Service Network, Level One Bank, $350,000-$1,000,000, 53 jobs

Zingerman’s Coffee Company, Level One Bank, $150,000-$300,000, 41 jobs

Zingerman’s Training, Level One Bank, $150,000-$300,000, 16 jobs

Ann Arbor Observer, John Hilton, Old National Bank, $150,000-$300,000, 17 jobs

Dahlmann Apartments, Dennis Dahlmann, Old National Bank, $150,000-$300,000, 14 jobs

Ecology Center, Michael Garfield, Level One Bank, $150,000-$300,000, 14 jobs

Jerusalem Garden, Ali Ramlawi, Level One Bank, $150,000-$300,000, 32 jobs

Nacht Law, David Nacht, Nick Roumel, Comerica Bank, $150,000-$300,000, 12 jobs