LANSING – State Representatives Dian Slavens (D-Canton), Deb Kennedy (D-Brownstown), Gino Polidori (D-Dearborn) and Bob Constan (D-Dearborn Heights) today threw their support behind a bipartisan, bicameral plan that will help make Michigan a leader in emerging high-tech industries by dramatically expanding the tax credits available to companies that are involved in the production, development and commercialization of advanced battery technologies. The original tax credits, signed by the Governor in January, offered businesses a potential $335 million in refundable tax credits.
"These incentives are a great tool to attract new and expanding businesses to our state," Slavens said. "The battery technology being developed here in our state will help progress the development of the automotive industry, a business that is critical to Michigan. I'm glad to see my colleagues in both the House and Senate come together to craft this common-sense plan."
The bipartisan initiative would give an additional $200 million in tax credits for companies involved in all aspects of advanced battery development. These tax credits would be spaced out over the next four years, providing a continued benefit for new technologies and development. The plan also rewards companies who support fellow Michigan businesses by giving priority in the awarding of these tax credits to those who commit to using local suppliers.
"Michigan has the talent and the resources that businesses in high-demand fields are seeking," Kennedy said. "These incentives will help make Michigan and our community a key player in the emerging industries of the 21st century. By producing these batteries for the next generation of auto technology right here in Michigan, we can take a lead role in breaking our dangerous dependence on foreign oil."
The plan builds on the last tax credit initiative, which was the first of its kind in the United States and passed with overwhelming bipartisan support. The law authorized the Michigan Economic Growth Authority (MEGA) to provide refundable tax credits totaling up to $335 million for battery pack assembly; research and engineering to support battery use in vehicles; engineering of advanced battery technologies; and capital investment for construction of battery manufacturing facilities. MEGA awarded the first of these tax breaks last month to GM, for the production of lithium-ion batteries for the upcoming Chevy Volt.
"This plan is welcome news, especially in this tough economic weather," Polidori said. "The world's demand for alternative-fuel vehicles will only increase as time moves on and having these incentives in place will not only put Michigan back at the top of the auto industry, but it will help position Michigan as a leader in advance battery technology."
Under the most conservative estimates, the battery tax credits will create over 40,000 jobs and over $9 billion in economic activity by the year 2020, according to the Center for Economic Analysis at MichiganState University. The most likely scenario would see Michigan gaining nearly 90,000 jobs and over $18 billion in economic activity as result of the initial $335 million program.
"Michigan's workforce needs this plan now, more than ever," Constan said. "The good-paying jobs that will come out of this imaginative and future-thinking plan will stay in Michigan for years to come. I urge my colleagues across the aisle, in both the House and Senate, to quickly pass this plan and get our residents back on the job."