Make It In Michigan For Free
A REVOLUTIONARY APPROACH TO JOB CREATION AND URBAN REVITALIZATION
In the fierce national and global competition for new job-creating investments, Michigan must stand out from the crowd by creating the most favorable climate for business in America. At the same time, it is imperative that we retool our manufacturing base to compete and win in the new global economy. Manufacturing isn’t just a proud part of our history; it is a fundamental part of our future. The fact is that Michigan cannot be a strong state without a strong advanced manufacturing sector.
Make no mistake – we cannot look backwards and try to recreate the past. We must take bold steps to create the conditions for our future success. That means putting Michiganders back to work at new jobs created by Michigan-based manufacturers with the resources they need to develop the most advanced technologies in the world, incorporate those technologies into the best and most competitive products in the world, and then make those products right here in Michigan.
To execute this strategy, it is not enough just to have low business taxes. Many states can make that claim. We must take an even more aggressive approach. To encourage entrepreneurs and innovators start and sustain new job-creating, advanced manufacturing enterprises, we must make Michigan the lowest-cost manufacturing environment in America.
Virg Bernero’s bold plan – Make It In Michigan For Free (MMF) – is a revolutionary approach to job creation that aims to rebuild Michigan’s manufacturing base and revitalize our cities, where more than eighty percent of Michigan’s industrial output is generated. By reclaiming contaminated industrial sites and repurposing abandoned, derelict buildings, we can create a dynamic new engine of job creation in the emerging sectors of the global economy, from green jobs making solar panels and wind turbines, to making parts for and assembling the world’s most advanced electric vehicles, to an extraordinary range of revolutionary products and materials based on the latest innovations in nanotechnology, bioscience and engineering.
Guaranteeing the lowest-cost manufacturing environment in America will create thousands of new, good paying jobs for Michigan residents, particularly in our largest cities. Michigan will once again become a national and international magnet for new manufacturing investment, and we will once again make the products that make America great. We will make it right here in Michigan and we will put people to work right here in Michigan, instead of China or Thailand or Malaysia.
As Governor, Virg Bernero will build partnerships with local and regional economic development agencies, local governments, land banks, private owners and financial institutions, to identify land and buildings in distressed urban areas across Michigan that are eligible for MMF status based on their potential for job-creating redevelopment as advanced manufacturing facilities.
MMF sites will be acquired through a variety of methods, including tax-reverted or foreclosed industrial properties owned by land bank authorities and local Economic Development Corporations using bonded funds. To ensure accountability and the fulfillment of investment and job creation commitments, MMF agreements will require strong accountability and transparency measures, including online annual reporting, clawback and revocation provisions.
The development of MMF properties – from environmental cleanup to building renovation to infrastructure improvements – will be undertaken at no cost to businesses that commit to creating new jobs.
Designated MMF sites will offer the following hyper-competitive advantages:
- TAX FREE STATUS – No sales tax. No corporate income tax. No real property tax. No personal property tax. No state or local taxes of any kind for up to 12 years.
- FREE LAND and BUILDINGS – The state will work with local and regional economic development agencies, local governments, land banks, private owners and financial institutions to acquire land and buildings suitable for redevelopment, including former automotive plant sites, abandoned buildings and brownfield sites with significant environmental contamination.
- FREE ENVIRONMENTAL REMEDIATION – The state will leverage federal environmental remediation funds, including more than $160 million already approved for cleanups at former General Motors facilities, to prepare approved MMF sites for job-creating redevelopment as new advanced manufacturing facilities.
- FREE INFRASTRUCTURE IMPROVEMENTS – The state will leverage federal Economic Development Administration (EDA) funds to make necessary infrastructure improvements on MMF sites, including utilities, broadband, roads and sidewalks, parking areas and outdoor lighting.
- INTEREST-FREE LOANS – The state will provide qualified firms with guaranteed business financing for the acquisition of manufacturing equipment and building improvements interest-free for up to 5 years.
TAX-FREE STATUS – MMF sites will be designated in urban core communities and eligible non-core locations to target the growth of advanced manufacturing. Within an MMF site all taxes are eliminated in the ultimate attempt to encourage new private investment and job creation. Taxes exempted at a designated MMF site include: Sales, individual income (state and local), corporate, Michigan Business Tax (MBT) and all real and personal property. MMF sites will be designated on qualified land and at rehabilitated structures as prioritized by local municipalities. A formula will be established that employs a population-based ratio per municipality for the designation of MMF sites, but all cities will be able to create at least one MMF site. The MMF site designation will be valid for 25 years, but it will be turned on or turned off by the local partner and the Michigan Economic Development Corporation (MEDC) for a period of 12 years based upon qualification and annual accountabilility requirements fulfilled by each individual applicant.
FREE LAND AND BUILDINGS – Primarily through the County and State Land Bank Authorities, or within other bonding-enabled authorities such as local Economic Development Corporations or Local Development Finance Authorities (LDFA), the MEDC’s Michigan Strategic Fund will provide matching funds with local partners to become successful U.S. Department of Commerce Economic Development Administration (EDA) applicants for the purchase and ownership of buildings appropriate for advanced manufacturing. Partnerships with community colleges, MI Works agencies, Chambers of Commerce and Small Business Technology Development Center (SBTDC) agencies will also be required as part of the ownership and service provider arrangements of each MMF site. Buildings will be available for advanced manufacturing incubation and invention as well as permanent manufacturing companies. This program especially assists manufacturers by assisting with the burden of heavy, universal equipment integrated with the building such as overhead cranes and certain CNC machinery like 3D Printers.
FREE ENVIRONMENTAL REMEDIATION – Oftentimes, the primary obstacle to public ownership of unused properties suitable for advanced manufacturing is past contamination liabilities. Local public owners will be relieved of this liability through actual clean-up grants awarded by the U. S. Environmental Protection Agency (EPA), in particular, and starting with more than $160 million already approved for General Motors legacy sites through the new federal automotive trust fund. Further remediation dollars will become available that are currently contained within other Michigan Department of Natural Resources and Environment (MDNRE) designated accounts.
FREE INFRASTRUCTURE IMPROVEMENTS – The MEDC will allow the use of Community Development Block Grant (CDBG) monies to the maximum federal standards allowed ($50,000 per new low to mod job created) to put in required public infrastructure for non-entitlement communities. Matching monies will be provided by the MEDC/MSF as well as local municipalities. For entitlement communities, the same mechanism will be used through county level CDBG, but local CDBG must match.
INTEREST-FREE LOANS – In partnership with the Michigan Main Street Bank, loan guarantees will be made to help support and subordinate bank loans to the manufacturing sector. Acceptable collateral including personal guarantees must be provided. These loans will include an interest-free provision for up to 5 years for the acquisition of qualified manufacturing equipment, provided that job creation targets are met or exceeded.