A lack of transparency surrounding subsidies from the Michigan Economic Development Corporation (MEDC) casts a dark shadow on the government agency. As Tom Gantert of Michigan Capital Confidential reports, in 2016 the Great Lakes State will dole out more than $1 billion in subsidies to private businesses.
Yet, the MEDC, which “oversees the state’s corporate welfare programs … refuses to say which business get the payments or how much they are paid.” Furthermore, as Gantert writes, these subsidies come in the form of “refundable tax credits,” created with government agreements lasting as long as 20 years.
Making matters worse, Gantert notes, “companies have some discretion over when to claim these credits, which means the Department of Treasury never knows for certain how large the bill will be in any year.”
Mackinac Center’s James Hohman gives a common sense summary of the situation: “The state is expected to give over $1 billion of other people’s money to companies it selected for favors. It’s bizarre that taxpayers are not allowed to be told which ones are collecting.”