Shovel ready
Via Michigan Capitol Confidential
Michigan’s former flagship economic development program was used for years by politicians on both sides of the aisle to tout job creation projections. But a review of the program shows those jobs rarely materialized.
Of the 434 Michigan Economic Growth Authority (MEGA) credits approved for new jobs from 2005 to the end of the program in 2011, only 10 projects met or exceeded their estimated job counts. In other words, just 2.3 percent of MEGA projects met or exceeded expectations.
The Michigan Economic Development Corp., which oversaw the program, projected that these projects would create 122,785 jobs. In fact, only 13,914 materialized.
“These job projections benefited only a few people — mostly politicians running for re-election,” said James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy, who tracked the program.
Inauspicious Beginning
The MEGA program began during the administration of Republican Gov. John Engler in 1995. Viewed as a way to get businesses to come to Michigan and industries already in the state to expand, the program empowered a centralized board to give tax breaks to select companies.
Over the years, the program expanded drastically.
In the 2000s, Michigan’s economy began to deteriorate. Under the administration of Democratic Gov. Jennifer Granholm, with help from a bipartisan legislature, the MEGA program exploded. An original cap on the number of credits issued per year was eliminated, and Gov. Granholm repeatedly touted the program as a way to help “reinvent,” “diversify,” and “grow” the state economy.
HT Watchdog