LANSING — Michigan will give companies $410 million to open two electric vehicle battery plants following approval of transfers by a legislative panel on Wednesday.
The Democratic-led Senate Appropriations Committee authorized the subsidies for Dearborn-based Ford Motor Co. ($210 million) and Novi-based Our Next Energy Inc. ($200 million) on 15-4 votes.
They did not vote, however, on a package for Gotion Inc. ($125 million), a Silicon Valley-based subsidiary of a Chinese company, and The Right Place ($50 million), a Grand Rapids-based economic development organization that plans to buy land, upgrade infrastructure and do other work to prepare the site near Big Rapids.
The chair, Sen. Sarah Anthony of Lansing, said panel members have questions about the Gotion project and she is not aware of a deadline for the committee to act six months after the Michigan Strategic Fund board first authorized the incentives. Some local opponents of the project — worried that lawmakers might approve it — drove to Lansing to testify against it, but she adjourned without taking public comment.
“I do have my own questions, and that’s another reason why you didn’t see it on the agenda. I’m weighing everything before I bring it before our committee,” Anthony, a Democrat, told reporters three weeks after the panel had a hearing with representatives of Gotion, The Right Place and Green Township.
She said she has questions about Gotion’s wages and benefits, workers’ cost of living and the company’s ability to work with labor unions. Republicans have expressed national security concerns because of Gotion's Chinese ties.
Gotion workers on average would make $29.42 an hour, or about $61,000 annually, according to an October memo written by the Michigan Economic Development Corp. The average hourly wage in Mecosta County is $21.33, or roughly $44,000.
Gotion wants to start construction in July.
Anthony, noting the Senate’s new Democratic majority, said “there is significant interest in looking at how these projects are being considered. It’s not a great feeling when we’re the last step in a process in which lots of the negotiations and the vetting and things happened and then at the finish line lawmakers are (told), ‘Now go ahead and approve it.’ I think that the Senate has a reputation for being the deliberative body, and you’re seeing deliberations. You’re seeing us do our research.”
She said there is a “mix of concerns, but there’s also a willingness and a desire to move projects forward.” The committee, she said, wants to attract businesses, “but it has to be right for Michigan and it has to be a good use of taxpayers dollars.”
Ford’s factory will be in Marshall, ONE’s in Wayne County’s Van Buren Township.
The Michigan Strategic Fund board previously approved the aid for all three plants, which is part of broader incentives packages for the multibillion-dollar factories, but final legislative authorization was needed to transfer money within the Strategic Outreach and Attraction Reserve Fund. The House budget panel gave its blessing, including for the Gotion-related transfers, in March.
Ford plans to build a $3.5 billion, 2,500-job EV battery plant, a project that is getting significant taxpayer support. The state has also awarded the automaker a 15-year tax break worth $772 million and authorized a $36 million loan for the Marshall Area Economic Development Alliance to buy, improve and transfer land. Gov. Gretchen Whitmer has signed a bill with $630 million to prepare the megasite for Ford, and an additional $120 million is expected to be sought at a later date.
ONE plans to open a $1.6 billion, 2,100-job EV battery factory. The state has also OK’d a $21.7 million tax exemption and a $15 million loan.
Gotion plans to build a nearly $2.4 billion, 2,350-job EV battery plant. The state has also awarded a 30-year tax break worth $540 million.
All 13 Democrats and two of six Republicans — John Damoose of Harbor Springs and Mark Huizenga of Walker — supported the Ford and ONE grants.
From Crain’s Detroit Business.