New Renaissance Zones Aid Business Expansions, Secure 7,036 Jobs in Jackson, Kalamazoo

Wednesday, June 25, 2008

Tax-Free Zones Facilitate Manufacturing, Research Expansion Projects

Governor Jennifer M. Granholm today announced Michigan Strategic Fund Board approval of a new Pharmaceutical Recovery Renaissance Zone for an expansion by MPI Research Inc. in Kalamazoo and nearby Mattawan expected to create 3,300 new jobs and spin off another 3,300 indirect jobs. In Jackson, a new 33-acre subzone will support an expansion by Production Engineering Inc. which is expected to create and retain a total of 436 jobs. 

“Keeping and growing innovative companies in Michigan assures the state’s future ability to attract new investment and jobs to Michigan,” Granholm said. “Enabling them to create and support good-paying jobs will benefit hundreds of families in their communities.”

The $330-million multi-site location expansion of MPI Research, a leading provider of comprehensive preclinical research and development services, was announced in April. The first site will be an expansion at the current headquarters facility in Mattawan, involving $300 million investment and an additional 2,900 new jobs. At the second site, MPI will launch new operations within the Pharmaceutical Recovery Zone utilizing buildings in the city of Kalamazoo owned and formerly occupied by Pfizer Inc. Estimated capitalinvestment of $30 million, to include building improvements and some new construction, is expected to yield an increase of 400 new jobs. The company’s tenure in the zone runs for15 years from January 1, 2009 through December 31, 2023.

In Jackson, the tax-free Renaissance subzone is being created to allow relocation of ProductionEngineering to the former Goodyear warehouse, a 445,000-square-foot structure on a 20-acre site at 2400 Enterprise Drive. An alternative site in Indiana was under consideration for the $11.2 million investment. The company’s tenure in the zone runs for 15 years from January 1, 2009 throughDecember 31, 2023.

The Production Engineering expansion, announced by the governor June 20, will result in retentionof 112 jobs and creation of 324 new jobs, including 122 directly by the company. The manufacturer of heavy truck axles and drivetrain componentshas experienced sales growth of more than 80 percent in the last two years and outgrown its 65,000-square-foot plant in Summit Township, Jackson County, where it has already expanded four times.

Renaissance Zone designation allows a company operating within the zone to operate free of virtually all state and local taxes. Michigan’s 1996Renaissance Zone Act as amended gives the Michigan Strategic Fund Board the authority to add new subzones to existing Renaissance Zones through December 31, 2011.  

“Tax-free Renaissance Zones in 21 urban, rural and former military locations are attracting new investment and job creation to communities all around the state,” said MEDC President and CEO James C. Epolito, who is also chair of the Michigan Strategic Fund board. “They are one of the state’s most powerful economic development tools.”

About Michigan Economic Development Corporation (MEDC)

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