LANSING – The full Michigan Senate will have another crack at legislation that would allow large-scale employers, in exchange for job creation, to keep a portion of the income tax generated by their new employees, as the bills unanimously cleared a Senate committee Thursday.

The Senate Economic Development and International Investment Committee adopted a substitute to the main bill (SB 242 that Sen. Jim Stamas (R-Midland), the bill sponsor, said cleans up language on oversight.

“We’ve always intended it to be not only for new jobs and businesses coming into Michigan but to be inclusive of businesses that have already chosen to be here in Michigan,” Mr. Stamas said.

The other two bills, SB 243and SB 244, saw no changes from when they were introduced last week (See Gongwer Michigan Report, March 16, 2017). Charlie Owens from the National Federation of Independent Business-Michigan submitted a card in opposition to the legislation on Thursday.

“Targeted tax handouts to select industries and individual companies through the MEGA program, and refundable tax credits baked into the Michigan Business Tax, were the hallmark of the failed Granholm administration and Michigan’s lost decade,” Mr. Owens said in a statement. “Even now, current budgets are stressed trying to account for billions of dollars given away during the last big ‘good jobs’ program.”

The crux of the legislation is that eligible businesses creating at least 500 new qualified jobs that pay the average wage or higher for the prosperity region in which the business is located to be eligible to receive up to a five-year, 50 percent abatement on the personal income tax withholdings of new employees.

Companies creating at least 250 qualified new jobs paying wages at 125 percent or more of the prosperity region average wage would be eligible to receive up to a 10-year, 100 percent abatement.

And if a company failed to meet the required amount of jobs, it would not receive the incentive for that fiscal year but could re-apply to claim it if it met required thresholds the following year(s) for the duration of its incentive.

Stamas thanked members of the Good Jobs for Michigan coalition that came out in a strong showing for the legislation last week.

“I think (the legislation is) a positive that moves us forward in the right direction,” he said.

Sen. Ken Horn (R-Frankenmuth), the committee chair, agreed.

“I think this is such an important piece of legislation as we try to grow the state of Michigan and (for) all the jobs all of us have hoped for … in this past decade,” Mr. Horn said. “I think we’re on a pretty darn good roll with these series of bills.”

The bills are largely seen as companion legislation to a package known as the brownfield redevelopment bills that are currently being considered in the House. That legislation (SB 111, SB 112, SB 113, SB 1134and SB 115) allows developers to capture a portion of sales, use and income taxes to redevelop brownfield sites. The House on Wednesday put a sunset on the legislation.

The legislation reported by the Senate committee on Thursday, labeled by supporters as the “Good Jobs for Michigan” package, could be considered by the Senate as soon as Tuesday.

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