Tuesday, April 19, 2011

Snyder Flip Flop Alert : MEDC Claims Michigan Business Tax Incentives and Credits to Continue

Flip, Feb. 18, 2011, "Snyder budget: The era of the tax credit is over":

In case there was any question, Gov. Rick Snyder made it plain today: Business tax incentives as Michigan knows them will be gone.

With elimination of the Michigan Business Tax and a new 6 percent corporate income tax in place, Snyder proposes eliminating tax credits for brownfield redevelopment, the Michigan Economic Growth Authority program, alternative energy, energy, film, renaissance zones and others.

Flop, Apr. 19, 2011, "Officials: Snyder will continue tax relief for Detroit urban development":

The head of Detroit's economic growth agency said Monday he is confident Gov. Rick Snyder will maintain tax relief for major urban developments even as he tries to kill state tax incentives used in virtually all downtown developments.

"The names (of the tax credits) may change, but the support of the governor is there," said George Jackson, president and CEO of the Detroit Economic Growth Corp. "One thing I can assure you, Gov. Snyder is very sincere in regards to the importance of the city of Detroit, and we've been working very well with (Snyder) toward a solution."

Jackson made the comments here Monday at an official groundbreaking ceremony for downtown's latest example of a major redevelopment made possible by the state's historic preservation and brownfield redevelopment credits: The planned $53 million renovation of the Broderick Tower into mostly apartments.

Jackson said he and other economic development officials from across the state have met at least six times since February with Snyder and officials from the Michigan Economic Development Corp., which approves the state's current tax incentives. Talks continue to hammer out details about broad-based relief that would keep urban development going.

Snyder's office did not return calls Monday, but Michigan Economic Development Corp. spokesman Michael Shore confirmed the meetings have happened.

"The essence of what we do won't change," Shore said. "The (tax) support will continue."

But... but... but... has anyone alerted the rest of the media on what appears to be a major flip-flop in Snyder administration fiscal policy? Hello? Anyone? Bueller?

Actually, I'm in favor of targeted tax incentives to diversify our economy, and I also like the idea of historic preservation and brownfield redevelopment too. I also agree there does need to be a limit set - where that floor is, I don't know. After we have diversified enough to where another collapse of the auto industry doesn't take down the whole state again perhaps. And, since other states are not laying down their incentive weapons, we can't either. That's just a fact of business life.

But what is going on here is that the Snyder administration made a big show to the public of saying they would eliminate these tax incentives - while at the same time they are giving city and economic development officials a wink and a nudge and telling them, "Don't worry, the payoff will continue. You just have to talk it over with our friends in the partisan legislature too, see, and get their approval. Maybe make it worth their time..."

Yeah. Like that. Conspiracy theory? Not really, because you can almost guarantee that is what is going on already, to some extent - the Snyder people are just going to officially add "more government" to the mix.

Come to think of it, for a guy who has indicated we need to "get government out of the way", that's a flip-flop too...

UPDATE: Funny this gets press on a MEGA credit announcement day:

Five companies will expand or locate in Michigan and one brownfield redevelopment project will rise under tax incentives granted Tuesday by the Michigan Economic Growth Authority.

The companies involved estimate that projects will generate up to $163 million in new private investment, adding a projected 1,376 jobs.


For the year to date, the MEGA board has approved agreements to assist the expansion of 39 companies that are projected to invest $758 million and create or retain nearly 9,000 direct jobs. It has also approved five brownfield redevelopment projects with projected new investment of more than $300 million.

So it's business as usual, which is fine by me. The complete and utter lie to the public about eliminating these credits is still a bit disturbing though. Don't make me dig up Cassis to complain...