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by Remington Hernandez|StatewidePoliticalReporter
LANSING, Mich. — Michigan's economy is just one of many issues voters will be considering when they hit the polls in November, but the agency tasked with boosting business in the state continues to face criticism, and changes are planned no matter who wins the governor's office.
The Michigan Economic Development Corporation (MEDC) is a quasi-public entity established in 1999, bringing a host of offices and programs together to create jobs and promote the state.
In the almost 30 years since then, many question how effective it's been.
A 2020 study by the Mackinac Center for Public Policy looked at incentives provided to companies in Michigan over four decades and how beneficial they were.
According to the study, the funds lifted both employment and sales at those firms by 7.1% and 9.9%, above companies that did not receive funding.
The average incentive amount per job created, however, was $593,913 per year, the study found.
Currently, the MEDC provides hundreds of millions of dollars in grants and tax incentives, going to projects like parks or small business renovations.
Those typically go forward successfully and without controversy, but the agency has also seen major setbacks.
In Genesee County, the 1,300-acre Mundy Township advanced manufacturing site remains vacant, even after $250 million of state funding were given to SanDisk to clear land.
Thousands of jobs were promised, but the company backed out.
In Mecosta County, Gotion's planned battery component plant in Green Charter Township, for which it was to receive tax incentives and state funds in exchange for the 2,300 jobs it would create, never materialized.
That followed a change in local government driven by opposition to the plant. Legal action was also taken in the case and the state sought to recoup $23.7 million already paid to Gotion.
Former MEDC board member Fay Beydoun was also indicted this year for allegedly misusing $20 million in grant funding from the agency, provided to a purported business incubator ran by Beydoun.
Gov. Gretchen Whitmer's administration has made economic development a key policy, and the MEDC has stood by its efforts to create jobs.
Despite multiple bills in the state legislature to shut down or heavily reform the agency, it will be the next governor who decides its future.
State Rep. Jay DeBoyer (R-Clay), now running for lieutenant governor alongside gubernatorial candidate John James, championed the legislation.
"I think that the MEDC needs to be looked at hard, it needs to be cleaned up, and it needs to be reined in, because it seems like there hasn't been any guardrails in place with taxpayers dollars," DeBoyer told reporters at the Michigan Republican Party's nominating convention.
In a statement, James said the MEDC needs a complete overhaul.
"As Governor, I’ll demand measurable return on investment, transparency, and accountability for taxpayer dollars, while focusing economic development on first retaining the jobs Michigan already has, then reclaiming the jobs we’ve lost to other states, and then recruiting new investment," James said. "I’ll also reduce the tax and regulatory burden while lowering the cost of energy and insurance."
Democratic Secretary of State and candidate for governor, Jocelyn Benson, believes the MEDC needs reform, saying in a statement it's clear the agency is not working for Michiganders.
“I will not give the MEDC another cent until substantial guardrails are put into place to ensure this type of corruption never happens again," Benson said. "Our tax dollars should be hard at work to lower costs for residents, grow the economy, and invest in our communities."
Benson, at a time when trust in government is at an all time low, calls reform a moral responsibility.
At the Michigan Democratic Party's nominating convention, Benson also outlined her plans for economic development as governor.
"I believe in the people driven economic development vision that diversifies our economy, that ensures small businesses can grow with ease, that we're investing in their growth in every corner of the state, and that we're coupling that with a workforce development agenda and investing in infrastructure in places that will ensure, as we generate talent, that we keep our talent here," she said.
The administration of the MEDC is the purview of the governor, so there is a lot Benson and James could do, though its funding is controlled by the legislature and some is already locked in.
2026 Sinclair, Inc.
