Secretariat

U.S. State Programs for New Investments

Available Investment Programs

Michigan

Taxes

• Industrial Property Tax Abatement (IPTA) is offered to promote renovation, expansion and new plant construction in the state of Michigan. Exemptions on property taxes are 50% for new facilities and machinery and 100% for renovation projects and are available for up to 12 years.
• Selected cities and counties designated by the state as renaissance zones grant, legally guaranteed, virtual tax-free status to any business currently located in or moving into the area. The following taxes are waived; single business tax, personal income tax, Michigan's 6 mill business tax, local personal property tax, local real property tax, local income tax, and users tax. Designed as a market based incentive, businesses in these areas pay virtually no local or state taxes. Zone designations last from 10 to 15 years, starting from January 1, 1997. Tax relief is phased out in 25% increments during the last three years of the program.
• The Michigan Economic Growth Authority (MEGA) offers tax credits to companies that create at least 75 new good-paying jobs (150% of the federal minimum wage) in the area of manufacturing so long as they meet certain criteria. The credit is applied against the single business tax (SBT) under two different programs, one for new jobs created and one for increased authorized business activity.

Employee Training

• Employers identify their own customized employee training needs and work with schools and government agencies to develop effective worker readiness programs. State grants average $700 per employee and can be used to train or upgrade skills.
• Michigan's annual Economic Development Job Training (EDJT) program provides approximately $29 million each year to companies through a competitive process for the training and retaining of workers. Employers are required to match 25% of the state grant for the training of existing workers.

Financing

• Industrial Development Revenue Bonds (IDRB) are issued to provide development projects with long-term loans at below-market interest rates for real estate acquisitions, equipment, building construction, machinery, and renovations for manufactures. Both tax-free and taxable bonds are provided, depending on certain criteria.
• Tax Increment Financing (TIF) is a method of financing the public costs of a development or redevelopment project. Increased property tax revenues or tax increments above a base value are used to pay for infrastructure, site acquisition and clearance, relocation and other public costs stemming from the project.
• Infrastructure improvement programs offered by state and local governments are available to ensure the proper environment is available for companies. Such programs include the Community Development Block Grant, which provides funds for road, water and sewer improvements necessary for a firm to locate or expand in an area. The amount of the grant is determined by the amount of private investment in the project and the number of jobs created.

< Table of Contents | Indiana >