Advocacy News – March 10, 2022
This week, the Michigan House and Senate Appropriations committees both voted in favor of transferring $666.1 million to General Motors and LG Energy Solutions for the purposes of siting and expanding electric vehicle production and the creation of up to 4,000 jobs in the Great Lakes State. The project and subsequent votes were the first under the state’s historic new economic development incentive programs signed into law at the end of last year with strong bipartisan support and backing of the Michigan Chamber.
Michigan Chamber President & CEO, Jim Holcomb provided written testimony on the importance of the unprecedented opportunity to invest strategically in the future of Michigan and lay the groundwork for job and economic growth for the state’s next generation auto industry and advanced manufacturing leadership and competitiveness. Holcomb’s remarks emphasized the necessary and evident transparency of the transfer, highlighting the opportunity Michigan lawmakers have to review the terms of the agreement before providing approval to ensure accountability. The full written statement is below:
“This memorandum is to voice the Michigan Chamber’s support for Legislative Transfer Request 2022-1, which provides for $666.1 million in economic development incentives, including $600 million for the Critical Industry Program and $66.1 million for the Strategic Site Readiness Program.
The bi-partisan package the legislature overwhelmingly approved in December (SBs 769, 771 and HBs 5603, 4082) forged a new path forward on economic development incentives in Michigan. Gone are the days of blank checks and decisions being made in a vacuum. In are the days of a transparent process with legislative oversight and accountability; under the new law, money may only be expended if an appropriation is authorized by law or a legislative transfer.
The legislative transfer before you today is a sign that the process is working. It gives you the opportunity to review the final terms and conditions of economic development deals and sign off. However, we would caution you not to stall the progress that has been made; act today to approve the measure before you, so your previous efforts can have a meaningful impact.
The transformational project presented today provides for $600 million in incentives and assistance for General Motors (GM) and their partner, LG Energy Solutions. It is an opportunity to grow the next generation of auto jobs in Michigan. If the legislative transfer is approved, GM will be able to make a $7 billion capital investment in EV and battery production in Michigan (Delta and Orion townships) and add up to 4,000 new jobs.
It’s important to remember that, in addition to giving the legislature the final say on economic development deals, the legislation passed in December creates specific timeframes and benchmarks for businesses to receive a disbursement from the state. Specifically, Senate Bill 771 creates a second layer of protection and accountability by requiring the Michigan Strategic Fund (MSF) Board to include claw back and specific repayment provisions in the instance the incentive recipient fails to meet the terms of their agreement with the state.
We hope we can count on your support for this legislative transfer that will allow Michigan to secure this long-term growth opportunity. From there, we can work together to continue to evaluate how the economic development package the legislature passed in December can help Michigan compete and grow.”
For questions or more information, please contact Leah Robinson at lrobinson@michamber.com.