Ford receives $26M from sunsetting state incentive program

Ford Motor Co. could be the last company to receive the state’s Good Jobs for Michigan tax incentive that allows companies to keep a portion of the income taxes that would otherwise be paid to the state. 

On Tuesday, the Michigan Strategic Fund board approved $26 million in Good Jobs withholding for the Dearborn automaker, as well as a smattering of other assessment exemptions totaling about $10 million. The state will forego all income taxes generated by the expansion for a period of up to 10 years. 

In return, Ford plans to invest $1.45 billion and create 3,000 new jobs spread over two facilities in Dearborn and the city of Wayne. The company also says its considering Wayne as the location for a new autonomous vehicle production center, according to a state memo. 

“Ford is proud to be America’s number one producer of vehicles and the largest employer of UAW-represented autoworkers,” Joe Hinrichs, president of Ford, said in a statement. “We appreciate the strong support from the State of Michigan and our local government partners as we continue to invest in our operations and people in Michigan.”

Gov. Gretchen Whitmer called the Ford expansion “great news for Michigan auto workers, their families, and our economy as a whole,”

The award of the Good Jobs incentive on Tuesday comes just two weeks before the program is set to sunset on Jan. 1, 2020. Before adjourning for the year, lawmakers failed to take up legislation from state Sen. Ken Horn (R-Frankenmuth) that would have extended the program and increased the cap to $500 million. 

The Ford incentive leaves just $5.6 million left of the initial $200 million that had been allocated for the program, according to figures from the Michigan Economic Development Corp. (MEDC), the quasi-governmental nonprofit that administers the state’s economic development incentives. 

“We certainly are hopeful that the Legislature will take that up when they come back in the new year,” said Jeff Mason, president and CEO of the MEDC. “I think its a very effective tool and I think 11,200 high paying jobs and $6.4 billion of private investment reflect that.”

Fiat-Chrysler Automobiles also received a Good Jobs for Michigan incentive as part of its metro Detroit expansion, announced earlier this year.

https://michiganadvance.com/2019/05/21/state-and-detroit-officials-approve-fiat-chrysler-deals/

Also set to go dark once 2020 hits is the state’s Pure Michigan tourism advertising campaign. 

Whitmer and Republican lawmakers finalized a post-budget deal earlier this month that lacked funding for Pure Michigan. Whitmer had vetoed funding for the program back in September and its revival was not a major part of drawn-out discussions.

Republican leaders said they’re set to talk about it again with Whitmer in January.

https://michiganadvance.com/blog/pure-michigan-left-in-the-cold-leaders-to-talk-tourism-program-in-january/

“Come Jan. 1, you won’t see any advertising for the Pure Michigan tourism campaign,” Mason said, noting that the MEDC had some reserve funding to carry it from October through now, but that money is dwindling. “For the first time in 13 years, that campaign will be dark.”