The Ford Motor Company plans to pump billions of dollars into Michigan’s economy in exchange for billions in prized tax benefits.
The Detroit automaker’s deal agrees to spend $3.1 billion on Michigan factories and office spaces through 2025, doubling its financial commitment to the state to remain eligible to receive the MEGA tax credits, “The Detroit News” reports.
It centers on keeping nearly 41,000 jobs in Michigan, which equals 91 percent of Ford’s in-state employees. The deal is expected to gain approval from the Michigan Strategic Fund’s board this afternoon.
Ford also agreed to spread out collecting $9.38 billion in refundable tax credits through 2031.
Gov. Rick Snyder brokered the deal and is gaining praise for this victory. Although many of America’s industries have chosen to go offshore for labor costs this example stands in contrast.
This deal proves that business and government can agree to a deal that is mutually beneficial, experts said.
“Ford has a strong incentive to continue to grow in Michigan as it helps the state rein in the costs of prior incentives,” Snyder said, according to The Detroit News.
While the “Big Three” automakers have gone back to having their earning in the black, they’ve seen their tax credits swell in value at the expense of the Wolverine State’s treasury.