Whitmer nixed requirement that GM keep workers at Detroit's RenCen. Will they return?

July 08, 2022, 12:02 AM


The state's newly revealed $3.8-billion tax credit deal with GM includes a twist that dings Detroit's pocketbook.

According to The Detroit News' Chad Livengood, Gov. Gretchen Whitmer in 2020 removed a stipulation that GM maintain at least 4,000 jobs at the Renaissance Center. While the state saved $325 million on the two-decade deal in exchange, city income tax collections have taken a hit and the RenCen's future is more uncertain than ever.

From The News:

One reason the Whitmer administration agreed to nix the headquarters job-count requirement is the state was competing for the automaker's $2.2 billion investment in retooling the Detroit-Hamtramck assembly plant to build all-electric cars, said a former state official who was involved in the negotiations with GM.

The automaker could have taken its investment in Factory Zero elsewhere in the wake of its 2019 decision to shutter the Warren transmission plant and two other plants in Lordstown, Ohio and Oshawa, Ontario, according to the source.

Michigan lets GM claim tax credits on up to 34,750 of its jobs with the minimum weekly wage of $1,300. That cap was put in place in 2016 by the Snyder administration to rein in soaring bills for taxpayers as GM's payroll swelled.

The Whitmer administration tried to go a step further by demanding a little relief for taxpayers because these tax credits are a liability on the state's balance sheet that's no different than an unfunded pension obligation.

The scale of the Snyder-era MEGA breaks was revealed this week after the Michigan Supreme Court ruled against GM in its attempt to keep them secret. The automaker received almost as much as Ford and Fiat-Chrysler combined.

Read more:  The Detroit News

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