Vote NO on Senate Bill 844 – Mackinac Center

The Mackinac Center for Public Policy recommends a NO vote on the conference report for Senate Bill 844, the supplementary budget that is expected to be considered in both houses later today. We specifically oppose the budget item of $846.1 million to be deposited in the Strategic Awareness and Attraction Reserve Fund.

First, the Mackinac Center has published a large body of research over many years demonstrating that firm-specific subsidies are inefficient, costly, and unfair. Our opposition on this basis should come as no surprise.

Second, the new appropriations exceed what is reasonable in a rapidly slowing economy, especially given the 7% increase in public funds already built into the omnibus appropriations bills for fiscal year 2023.

Third, although the structure of the SOAR fund is a modest improvement over previous programs that administered company-specific incentives, the Legislative Assembly’s experience with the General Motors and Ford deals demonstrates that the Michigan Economic Development Corporation does not is neither a competent nor trustworthy negotiator when it comes to major economic development agreements. This adds to MEDC’s decades of experience wasting state resources on projects that never deliver promised benefits for Michigan.

Fourth, this significant reduction in the state budget balance will make it much more difficult for the Michigan Legislature to reduce tax rates in a way that benefits all Michiganders and improves Michigan’s underlying business competitiveness. ‘State. Since January 2021, 24 states have reduced their personal income tax rates, with most also reducing their corporate tax rates. Reducing operating costs for all businesses and making Michigan a more attractive place to work and live is the path to improving Michigan’s attractiveness for business and talent, not company-specific grants.

Finally, the Mackinac Center’s Michigan Votes website hosts a business subsidy dashboard which shows how every member of the Michigan Legislature since 2001 has voted on legislation providing specific business subsidies. Last fall’s vote to establish and allocate $1 billion to SOAR is the most recent vote included in the dashboard. Since SB 844 allocates a total of $846.1 million to company-specific grants, voting on SB 844 will be included in this scorecard and marked at $846.1 million.


Permission to reprint this blog post in whole or in part is hereby granted, provided proper attribution is given to the author (or authors) and the Mackinac Center for Public Policy.

Norman D. Briggs