Brewed Fresh Daily

The price spread between gasoline and ethanol. Credit: Reuters

Today, I reported that ethanol, despite losing its hype, is bigger than ever in the U.S. 

The chart above, from Reuters, shows one more reason people in the ethanol industry are optimistic. The chart shows the price difference between gasoline and ethanol. And, right now, according to Reuters, gas prices are at an all-time high compared to ethanol. A gallon of the biofuel is more than a dollar cheaper than gasoline.

Craig Hoppen, the president of J&H Oil Co. in West Michigan told me that this margin makes a big difference when people decide whether to pump E-85.

“Lately, as gas prices went up, we’ve sold a lot more [E-85], because it’s very price competitive today,” Hoppen said. “When the margin goes down … the volume drops accordingly.”

Hoppen says as of this month, E-85 sales are up about 50 percent at J&H Oil’s filling stations.

But still, E-85 only makes up about 1 percent of total sales. The U.S. Department of Energy reports that there were only about half a million E-85 capable vehicles on the road as of 2009.

That’s why the ethanol industry isn’t counting too much on E-85 for the future of the fuel.

Before this campaign season, many voters in the Great Lakes had only peripherally heard of Rick Santorum. But his surprisingly strong challenge to Mitt Romney in Midwest Republican primaries most likely kept his campaign alive. 

Now, Santorum is suspending his race for the Republican nomination, effective today.

That most likely clears the way for Romney to become the first Michigan-born Republican nominee since Thomas Dewey. Romney, who hails from Detroit, is likely to face President Barack Obama in the fall.

“This race was as improbable as any you’ll ever see for president,” Santorum, a former U.S. senator from Pennsylvania, said this afternoon. But, he added, “We are not done fighting.”

Santorum achieved one distinction during this winter’s primaries, by becoming the only Republican candidate to visit Michigan’s Upper Peninsula. He had a pasty for breakfast and picked up nearly all the UP’s delegates.

Read Changing Gears’ coverage of the Midwest Republican primaries here.

Chicago has been notorious in the education community for one thing: its short school day. Elementary school students spend only five hours and 45 minutes a day in class, the shortest of any major city, while high schoolers spend only seven. Now, that’s about to change.

Chicago Mayor Rahm Emanuel

City officials announced today that the elementary school day will be seven hours this fall, while the high school day will rise to seven and a half hours.

That’s something long sought by Mayor Rahm Emmanuel, who has faced obstacles in lengthening the city’s school day. First, he tried unsuccessfully to cajole individual schools into voluntarily adopting a longer day. Then, he proposed an even longer day for elementary school students.

But after meetings with parents upset by the plan, the city announced a calendar that includes these features.

• All elementary students will move to a seven hour school day, and high school students will have a 7 1/2-hour school day, with a 75-minute early release one day a week. (In other words, they’ll have a normal school day four days a week, and get out early once a week.)
• The annual school day gains 10 additional days of instruction, moving Chicago from the shortest school year in the country to a 180-day year that is on par with the national average.
• A student entering kindergarten next year will receive nearly 2.5 additional years of instructional time by the time they graduate high school.
• Elementary school students will have a daily recess, which parents insisted upon.

Emanuel, who was elected last year to succeed Richard Daley, insisted throughout his campaign that the city needed a longer school day so Chicago children could compete on a global level.

“The time is not the goal. The time is an opportunity to be maximized,” he said at the announcement today. “That’s how you prepare for the future. That’s how you prepare kids that don’t get a do-over.”

The Federal Reserve Board of Chicago is out with its Midwest manufacturing index for February, and the numbers are something of a milestone.

The comeback in steel is good for places like Gary, Indiana/photo by Micki Maynard

The Chicago Fed uses 2007 as a baseline, meaning 100 on its index, which the Fed calls “a composite of 15 manufacturing industries that uses hours worked data to measure monthly changes in regional activity.” (We like to think of 100 as basically full staff.)

In February, the manufacturing index, which covers Wisconsin, Iowa, Illinois, Indiana and Michigan, stood at 91.7. The number for automobile manufacturing was even better — 92.2 — while steel manufacturing stands a tad behind, at 90.5 percent.

But that’s an important number, as we’ll explain.

Since the index goes up about a half a percentage point to a point per month, you might extrapolate that the region will be back to 100 by the end of the year. Of course, there’s no way to really nail that, given high gas prices and other economic factors.

But the real story is in the historic numbers.

Take a look at where the MMI stood in June 2009. It was at 67.9, the low for this recession.

That was the month that General Motors filed for a federally sponsored bankruptcy. Chrysler, which was just out of its bankruptcy, had shut down its plants that spring while it was under court protection, and it hadn’t yet cranked them back up.

The automotive number reflects the industry’s crisis: it was at 48.5 in May 2009. Steel, which relies heavily on the auto industry, reached its low for the recession in June 2009, at 57.3.

It has taken the index and both industries until this year to get back into the 90 range. For the overall index and for autos, that happened in January. Steel is back above 90 this month for the first time since the depth of the recession.

So in short, a couple of industries that were in pretty awful shape three years ago, are within shouting distance of normal when it comes to hours worked by those who are employed there. And, the improvement is showing up in an important measurement.

Spirit of Detroit. Credit: flickr user Urban Adventures.

After weeks of debate and sometimes raucous dissent, leaders in Detroit and Lansing finally signed off on a financial stability agreement for the city yesterday.

You can read the full agreement here. But as important as the agreement is, it doesn’t actually solve any of Detroit’s pressing financial problems. It merely lays out the structure and the powers of the new group that will.

So today is when the real work begins.

The Detroit Free Press reports today that the first step in the process is to hire 11 people. Mayor Dave Bing is in charge of finding the first two:

Mayor Dave Bing now has six days to create the positions of the city’s chief financial officer and program management director and 30 days after that to hire the people for the positions. Those holding the jobs must have experience in municipal finance and balancing the books of a government operation of at least $250 million. The candidate list and ultimate hires will have to be approved by Snyder and Bing.

The mayor, governor, state treasurer and city council will also each have a say about who goes on the nine-member financial advisory board that will oversee the city’s finances for the next few years.

Once the team is in place, the next big question is how to salvage Detroit’s finances. That’s where things may get ugly.

Sarah Cwiek, from partner station Michigan Radio, reports one of the biggest tasks will be to negotiate new contracts with the city’s unions:

They already agreed to give up historic concessions, only to have the state block final approval. Snyder says those agreements don’t go far enough.

Union leaders now say they’re in no mood to bargain. And they may have little recourse at this point but to strike.

Detroit’s new financial team may also face the difficult decision of whether to sell off city assets. The city is running an estimated deficit of more than $200 million, and Governor Rick Snyder says the state won’t offer up any cash to help fill the hole.

And there’s still a cloud of uncertainty hanging over the entire process, as legal challenges to the agreement work their way through the courts. There are challenges to the agreement itself, and challenges to Public Act 4, the state law that outlines what to do when a city faces a financial emergency. There are provisions in the agreement that say it’s still valid even if Public Act 4 is struck down. But a judge could just strike down those provisions.

Michigan Radio reports that Governor Snyder mostly dodged questions about the legal challenges during a media roundtable yesterday.

“I hope we can continue on this path, because I thought it was good, thoughtful legislation to begin with, and that we’re working in good faith to really make sure our communities are successful,” Snyder said.

Court challenge or not, the new team will have to work fast to fix Detroit’s problems. Estimates project the city will run out of cash completely by the end of June.

Dead or alive, you're coming with RoboCop. Credit: MGM

The RoboCop statue is definitely happening in Detroit.

That’s the update today from the Detroit News. For those who haven’t been following along, last year, a Twitter user in Massachusetts jokingly tweeted to Detroit Mayor Dave Bing that the city should erect a statue in honor of RoboCop, the cyborg public servant featured in the 1987 film based in Detroit. The mayor dryly responded that there were no plans for a statue, and suddenly everyone became interested.

One Detroiter set up an account on Kickstarter to raise money for the statue. Less than two months after that original tweet, $67,436 was raised.

Along the way, there has been controversy. Some don’t like how the RoboCop films portrayed Detroit – as a post-apocalyptic wasteland, run by an evil corporation. Some didn’t like the idea that people would spend money on a statue to honor a movie character, when so many other worthy projects go unfunded in the city.

RoboCop himself (actor Peter Weller) weighed in on Funny or Die:

Then, the idea grew beyond just the RoboCop statue. To take advantage of the attention surrounding the statue idea, local foodbank Forgotten Harvest launched RoboCharity. RoboCop (Peter Weller) made a video to support the charity. And, later this month, Forgotten Harvest will host a fundraiser, cosponsored by Funny or Die.

As for the statue itself, the Detroit News reports the original RoboCop costume is being scanned now, and the the resulting mold will be cast into a metal sculpture by Detroit’s own Venus Bronze Works.

According to the News:

“The statue’s definitely coming,” said Jerry Paffendorf, who spearheaded the controversial 2011 campaign to raise money and find a home in Detroit for the statue.

“The only thing that’s up in the air is the timeline and where it’s going to go.”

One possibility is to put the statue outside Imagination Station in Detroit, opposite the Michigan Central train depot.

When the RoboCop statue does rise in Detroit, will you go see it?

Vacant land on Moran St. in Detroit, as seen on Google Street View.

Detroit has a lot of vacant land. That much, you’ve probably heard by now. On Sunday, the Detroit Free Press took a look at efforts to put that land to use, and along the way, the paper rounded up some eye-popping statistics you might not have heard:

• There are more than 100,000 vacant residential lots in the city of Detroit.
• If you include commercial property, nearly a third of the city is vacant.
• If you put all of the vacant land together, the entire city of Paris could fit inside.
• The vacant land could also fit 25,000 football fields.
• Only 40% of the real estate parcels in the entire city have owners who pay their property taxes on time.
• Over the past 30 years in Detroit, 10 residential structures were demolished for every one that was built.

There are plenty of people who want to put this vacant land to use. But that’s proving more complicated than it sounds, thanks especially to a law passed by Michigan voters in 2006.

The Freep points out that Detroit isn’t the only city with a vacancy problem. Both Cleveland and Chicago lost population in the last census. Over at our partner station, WBEZ, Lee Bey has blogged about the “vast emptiness” on the South Side of Chicago. Here at Changing Gears, we ran a series on the many empty spaces in the Midwest.

But the scale of the problem is huge in Detroit. We’re talking about 40 square miles of empty land.

The Freep reports that people have proposed using that land for new recreation areas, solar arrays or urban gardening. There’s also a proposal for a large-scale commercial farm in Detroit. And our own Kate Davidson has reported on “blotting,” a trend where residents are trying to take care of the vacant properties next door. That trend got a big boost earlier this year, when Detroit mayor Dave Bing announced that residents could now own that vacant lot next door for just $200.

But experts who spoke to the Freep say, to really make a dent in Detroit’s vacancy, more large-scale projects need to happen. Right now, state laws are getting in the way.

Six years ago, voters in Michigan approved Proposition 4, a law that limits what the government can do with private land. The proposal was created in response to the Supreme Court Case Kelo v. City of New London. In that case, the city of New London, Conn. condemned a swath of privately-owned land so that it could be redeveloped, creating new jobs along the way. The Supreme Court decided it was a valid use of the city’s powers under eminent domain.

After that decision, many people across the country worried that governments would start seizing private property, and handing it over to big developers, all under the guise of “economic development.” Twelve states passed new laws to prevent that from happening. Michigan was one of them.

Prop 4 made it illegal for governments to take private property and transfer it to another private entity. It also raised the bar for taking “blighted” property.

From the Freep:

Under the new law, a city must prove by clear and convincing evidence that every property within a targeted district is blighted. It’s not enough to show that it’s true for 90% of the properties.

So, for the 100,000 pieces of vacant land in Detroit, the cash-strapped city would have to assemble 100,000 case files to demonstrate that the land is truly blighted.

About half of Detroit’s vacant land is already under the control of either the city or the county. But that still leaves about 50,000 lots left to claim.

The Free Press quotes Wayne State University law professor John Mogk:

“So long as we’re facing the limitations that we are, I don’t think land can be assembled in Detroit for major redevelopment,” Mogk said. “At this point, I don’t think it’s possible.”

For now, it seems, Detroiters will have to settle for the piecemeal approach, taking back what land they can, when they can. Last week, the Detroit News reported the commercial farming proposal, Hantz Farms, could be the first to assemble more than a few lots. The paper says Hantz Farms is expected to buy 200 lots from the city within the next few weeks.

It’s better than nothing.

Chicago is experiencing record ridership of the CTA, and it’s on a drive to spruce up 100 stations. Cleveland has high speed buses from downtown to the Medical Center. In Canada, Toronto has streetcars and every kind of transit you can imagine, including rental bikes.

Toronto rental bikes/photo by Micki Maynard

But Detroit? Well, besides the People Mover, public transportation has never been a big priority. However, mindsets may be changing, according to veteran journalist Rick Haglund.

In a column this weekend, Haglund says the environment for public transportation seems to be changing in Michigan. He cites two reasons: younger people aren’t as interested in driving or owning cars as they once were, and governments and business leaders are lending their support.

We know you’re intrigued about public transportation in Detroit, judging the response to the map we showed you with the Chicago “L” laid over the Motor City.

And, in Grand Rapids, voters recently approved a millage that will pay for upgrading the transit system.

But, would you be interested in riding a bus rapid transit system, a subway or even a streetcar if one was available? Or, is Michigan simply too wedded to cars? Let us know.

Michigan, Ohio and Illinois voters have had their chance. Now, it’s Wisconsin’s turn.

Wisconsin State Capitol

Voters in the dairy state go to the polls on Tuesday to cast ballots in the Republican primary. We’d love to hear how you voted, and what’s the most important issue on your minds.

After you vote, take our survey (or if you’ve already voted early, let us know now). It will help us understand whether different topics are of importance to people in different parts of the Great Lakes.