Monday, August 17, 2009

Republican Refusal to Move MEGA Credit Legislation Will Cost Michigan New Jobs

This issue was raised almost one month ago, right after the last announcement that the MEGA credits issued for July would create and/or retain nearly 15,000 jobs for Michigan, but as of yet the Senate Republicans still have not moved to expand the cap on these credits. Now, it appears we are going to lose the possibility of creating new jobs and encouraging companies to expand here because some in the Senate prefer to cling to obstruction rather than provide help for our state. And, there is the little matter of the Legislature taking almost two months of the summer off for vacation as well, but hey, what's the rush? Those unemployed folks can wait a little longer, can't they?

The CEO of the economic development group Ann Arbor Spark Michael Finney can now point to two companies that are waiting for an answer from MEDC to start their business plans - and by the way, one may be enticed to go elsewhere because of this delay.

“Businesses don’t wait for the calendar,” Finney said. “When they have an opportunity to move forward, they move forward. So we could potentially lose some if we don’t get this resolved within the next few weeks.”

Finney said one of the companies considering an expansion is an alternative energy research-and-development company, and the other is an information technology firm. One of the companies is considering competing sites in Texas and California, he said.

Nancy Cassis, the one who is holding the keys to this very important economic development tool, was unavailable to comment last week. Vacation comes first.

State Sen. Nancy Cassis, R-Novi, chairs the Senate Finance Committee, which is considering a bill to sign off on additional credits. Cassis was traveling this past week and could not be reached for comment.

Cassis is the puppet of the Mackinac Center extremists, who have constantly criticized the credits and wants to eliminate this development tool, even though that would destroy Michigan's ability to compete with the many other states that offer such incentives. Ideological purity is more important than creating jobs for these people, even if it costs us major players such as GE, GM, or Google. Cassis and the Mac Center question the validity of estimated figures - even though the credits don't kick in until the jobs are actually created. No jobs, no credits, sounds reasonable and fair - but "fair" never matters to those who insist on the "my way or the highway" approach, does it? Greg Main of MEDC is more than willing to supply the information they want, but points out that they are not accepting the reality of how this program works.

“I get a little frustrated when I see some of the comments that are made, because I think that this is a very good program,” Main said. “It has led to a lot of investment in Michigan that we wouldn’t have otherwise have had. Are there cases where companies don’t do what they say they’re going to do? Sure there are. But in that case we don’t pay anything out.”

Main said critics of the MEGA tax credit strategy don’t understand that the state isn’t doling out dollars until the company meets certain hiring goals. Companies receive tax relief in stages as they hire workers.

“The reality is the amount of the credit is always tied to the number of jobs that are created and the value of the income taxes that will be generated by those employees,” Main said. “If there is no job created, then there is no benefit paid out because there is no tax revenue. It is a self-funded, pay-for-performance program.”

That doesn't matter to people like Nancy Cassis or Michael LaFaive of the Mackinac Center though. It's not a question of "understanding" the program, it's a matter of public deception for the purpose of pushing their ideology. It's much easier just to just claim that these businesses are simply lying about their plans, and then fall back to the same old Bush Republican demand of "more tax cuts". Sound familiar?

But LaFaive questioned whether companies are telling the truth about their expansion plans.

“They can’t prove the companies weren’t going to come here anyway,” he said. “It would be better if you gave every business in Michigan a tax cut and not the favored few.”

Tell ya what, Mr. LaFaive. Why don't you just show up at the next MEGA meeting and start screaming "liar!" at all these businesses that are looking to invest in our state and give our people jobs. Seems to be the new standard plan of action for the right wing extremists who have no intention of listening to reason, and the Mackinac Center and their pet legislators certainly fit in this category.