What the Michigan Government Lacks in Transparency – Mackinac Center


It’s a travesty that state officials are refusing to disclose to Michigan residents which companies collect how many billions of dollars in state taxes in corporate subsidy payments. The state makes a wealth of information available on most of its spending, but mom is the word when it comes to providing transparency on that “economic development” money.

From 1995 to 2011, state economic development officials selected several hundred companies for tax credits of up to 20 years. A total of $14 billion has been awarded, according to the state auditor general, with the bill to be footed by taxpayers years after the deals were struck. The tax credits were “refundable”, meaning that whenever the credit owed to a given business exceeds its tax liability, the business receives a hard-earned tax-covered check that residents send to Lansing each year. .

And that’s what happened most of the time. Taxpayers paid $900 million more than companies owed in taxes last year.

These cash donations were sold to the public as an economic development program, but donation data indicates that they failed to accomplish this work. In reality, the state is lagging behind having spent hundreds of millions on job creation.

Most of these credits have not yet been cashed. State officials expect to pay an additional $7 billion before the credits expire.

Government officials spend taxpayers’ money and yet legislators don’t tell taxpayers who gets their money. Last fall a bipartisan Invoice was introduced to make this information public, but it has not yet been heard. Unfortunately, it’s not the first such bill to offer – then ignored.

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