Tuesday, May 17, 2005
Michael Shore, MEDC
Projects Expected to Generate $226 Million in Private Investment
Governor Jennifer M. Granholm today announced six company expansions and a brownfield redevelopment project that will create and retain up to 3,988 new jobs and attract more than $226 million in private investment to southeast Michigan. Incentives from the Michigan Economic Development Corporation were instrumental in convincing the companies to expand in Michigan instead of other locations outside the state.
"These diverse projects show Michigan can compete and win in the new economy of the 21st century," Granholm said. "The combination of our strong manufacturing base, highly skilled workforce and emerging high-tech industries has made Michigan very attractive to global companies looking to grow."
The projects are:
ALD Thermal Treatment Inc., a subsidiary of German-owned ALD Vacuum Technologies, plans to invest $20 million to expand in Port Huron instead of competing sites in Ohio and Canada. The project is expected to create 132 new jobs, including 95 directly by the company. A state Single Business Tax (SBT) credit valued at $915,000 over the next seven years helped convince the company to opt for Michigan. The city of Port Huron has also proposed tax abatements valued at about $1.6 million. ALD specializes in advanced vacuum heating services used in the specialized manufacturing of precision auto parts including fuel injector and transmission components.
American Axle & Manufacturing will invest a total of $80 million in two of its Michigan facilities-$73 million in Detroit and $7 million in Three Rivers-to accommodate the manufacture of General Motors' next generation of full size pickups and sport utility vehicles (SUV). The project will save a total of 1,568 Michigan jobs, including 458 in Detroit and 198 in Three Rivers directly by the company. An SBT credit valued at more than $7.7 million over eight years as well as an Economic Development Job Training grant of up to $458,000 helped persuade the company to expand in Michigan. The city of Detroit is expected to consider a tax abatement valued at $8.3 million over 12 years in support of the Detroit location. The city of Three Rivers has also offered a 12-year tax abatement valued at $364,000.
Compact Power Inc. plans to invest $18.1 million to locate a new research and development center in Troy instead of expanding an existing facility in Colorado. A subsidiary of LG Chem., the largest chemical company in South Korea, Compact Power develops lithium polymer battery packs for electric, hybrid fuel cell vehicles and military and aerospace applications. The project is expected to create 298 new jobs, including 168 directly by the company. An SBT credit valued at more than $3.8 million over the next 10 years helped convince the company to expand in Michigan. To further support the project, the city of Troy will provide $50,000 for necessary road improvements and is willing to support NextEnergy personal property tax exemptions worth up to $820,500.
J & L America Inc. plans to invest $11.8 million to centralize and expand its headquarters and business operations in Southfield instead of competing locations out of state. The project is expected to create 454 new jobs, including 300 directly by the company. An SBT credit valued at more than $3.4 million over the next eight years helped make the case for staying in Michigan. The city of Southfield approved a tax abatement valued at more than $178,000. J&L is a wholly owned subsidiary of Kennemetal Inc., a leading global supplier of tooling, engineered components and advanced materials consumed in production processes. Combined, J & L and Kennemetal affiliates employ 549 workers in Michigan.
Mexicantown Commercial Properties will develop vacant, partially tax-reverted property located in the Mexicantown community in southeast Detroit into a two-building complex. It will incorporate one of the state's Welcome Centers, retail space, a business incubator and a public plaza. Located about 500 feet from the U.S.-Canadian border, the Mexicantown International Welcome Center will have a projected 1.8 million visitors a year upon completion. State and local tax capture valued at more than $1.3 million will help prepare the property for development. The project is expected to create 63 new jobs.
United Solar Ovonic LLC, the world leader in thin-film photovoltaics for solar energy conversion, plans to invest more than $80.2 million to locate a new production facility in Auburn Hills. Tax credits valued at more than $6.1 million over 20 years and a $100,000 Economic Development Job Training Grant helped the company decide to locate the facility in Michigan over a competing site in Ohio. To further support the project, the city of Auburn Hills has proposed a tax abatement valued at $109,100 and is willing to support NextEnergy personal property tax exemptions that could be worth an estimated $6.9 million over the next eight years. The facility is expected to create 625 new jobs, including 230 directly by the company. A wholly owned subsidiary of Energy Conversion Devices (ECD Ovonic) (NASDAQ:ENER), United Solar currently employs nearly 200 employees in Troy and Auburn Hills.
The southeast Michigan projects are among a total of 10 the Governor announced today. In all, they are expected to create and retain a total of 5,006 Michigan jobs, including 2,630 directly by company expansions and redevelopments.
"Without the incentives offered today, these companies would have chosen to take their jobs and investment outside the state," MEDC President and CEO Don Jakeway said. "Each expansion is a success story highlighting Michigan's ability to compete in the global economy."
Granholm intends to continue the job creation momentum. She recently outlined details of her Jobs for Michigan Fund, a $2 billion bond initiative to provide a stable source of funding for research and commercialization efforts in several targeted high-tech, high growth industries. The bond issue requires legislative approval to be placed on the ballot for Michigan voters to decide in November. According to federal studies, the initiative can be expected to result in at least 72,000 new jobs for Michigan workers over the next 10 years.
In her 2005 State of the State address, Granholm emphasized the importance of making Michigan a global economic powerhouse in the 21st century. In the past 12 months the Governor and the MEDC announced the creation or retention of more than 41,350 jobs as a result of targeted assistance provided by the MEDC.
The Michigan Economic Development Corporation, a partnership between the state and local communities, promotes smart economic growth by developing strategies and providing services to create and retain good jobs and a high quality of life.