Friday, April 30, 1999
Governor John Engler today announced that he is recommending that the Michigan Economic Growth Authority job creation tax credit, which is allowed through the Single Business Tax Act, be extended. Under current legislation, the Michigan Economic Growth Authority, or MEGA, will expire on December 31, 1999. The Governor is proposing that date be extended for four more years, until December 31, 2003."Because these tax credits have been such a powerful incentive, we need to extend their availability. With MEGA, we have found a way to change the minds of company executives who were planning on locating in another state and get them, and their jobs, to Michigan," Engler said. "As a result, we're able to compete with other states and win excellent, high-paying jobs for Michigan workers."The MEGA program was created in 1995 to promote high-quality economic growth in Michigan that would not have occurred without the program. With MEGA, a business may receive Single Business Tax credits for new jobs being created at the project site. To be eligible, a company must create at least 75 new, full-time jobs if they already have a presence in Michigan, and 150 new, full-time jobs for out-of-state businesses locating in Michigan.The average wage of those new jobs must also equal or exceed 150% of the federal minimum wage. Governor Engler was joined by Senator Mike Rogers (R-Brighton), sponsor of the legislation, and Doug Rothwell, president and CEO of the Michigan Economic Development Corporation, which administers the program. "I've sat face to face with companies and negotiated these deals," said Rothwell. "Without MEGA we'd lose these jobs. I've seen companies with plans to go to other states and I've seen the cost disparities we've faced. MEGA is the tool we use to close that gap. In fact, without MEGA, 59 projects in the last 4 years would have gone to other states.""We've seen first hand that MEGA creates good jobs for Michigan families while saving taxpayers' money," Rogers said. "For every dollar we've spent on MEGA credits, the state will get back $4 in increased revenues. That's a winner all the way around."MEGA tax credits have been used in projects creating over 33,000 new jobs since 1995. Over the next 20 years these jobs will increase personal income in the state by more than $22 billion and increase state revenue by nearly $1.4 billion. The total capital investment in Michigan as a result of these MEGA credits is expected to be about $1.8 billion.