LANSING, Mich. — Legislation to increase accountability and transparency for the state’s economic development initiatives was introduced in the state Senate Tuesday morning.
“This package was largely about improving the public’s trust in economic incentives and improving the use of taxpayer dollars,” said Sen. Jon Bumstead, R-Newaygo, who co-sponsored each of the bills in the package. “Many of these partnerships played an important role in Michigan’s comeback and getting people back to work. I think they are worth supporting, but I can certainly agree some updates and metrics could be added to make sure we’re getting our money’s worth.”
The legislative package includes numerous budget safeguards to ensure taxpayer dollars are being used efficiently. For example, when an economic development incentive fails, funding will then be reverted to the state’s General Fund versus being left with the Michigan Strategic Fund.
Under the legislation, when a project does not produce the projected number of jobs, or the agreement has to be amended because results did not meet expectations, the financial incentive will be reduced by a proportionate amount — meaning the further away from the goal a project is, the less money it will receive.
The bills would also increase certain reporting requirements. For example, the bills would require public notice of companies who receive funds but go out of business or companies who are unable to meet the original agreement.
“As we carefully look at ways to save and rededicate money to the state’s most important needs, I believe this legislation is a fantastic place to begin,” Bumstead said. “Ensuring more accountability when tax dollars are at stake will give people a better idea of where their taxpayer dollars go, while still allowing them to enjoy the benefits that these incentives have been known to produce.”
Senate Bills 767-771 will move to the Senate Committee on Economic and Small Business Development for consideration.
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