SPOTLIGHT PROGRAMS

Michigan Business Development Program (MBDP): This discretionary program provides performance-based grants to support business attraction and expansion projects that involve capital investment and/or new job creation. To qualify, a business case for funding is required, new job creation and/or involve capital investment. To qualify based on new job creation, a business must create at least 50 jobs, 25 jobs in a rural county or if the project qualifies as an Innovation Industry. In certain instances, projects with less than 25 new jobs may qualify. The maximum amount of funding that may be provided to a project is $10 million.‍

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Critical Industry Program (CIP): This program can provide a grant, loan, or other economic assistance to qualified businesses for deal-closing, gap financing, or other economic assistance to create or retain qualified jobs as a result of a technological shift in product or production or make capital investments, or both, in Michigan.

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‍Michigan New Jobs Training Program: The MNJTP program provides funding to local community colleges which, in turn, can provide free training to area employers in support of new job creation.

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TAX EXEMPTIONS / ABATEMENTS

Border County Incentives:  Businesses that locate in one of 14 counties that border another state or Canada may receive full or partial tax abatements through a partnership between the State of Michigan and local municipalities. Eligible businesses may receive up to a 100% abatement of business personal property taxes. New warehousing, distribution, and logistics facilities can qualify for up to a 50% reduction in real property taxes for up to twelve years.

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Renaissance Zones: This program can provide businesses with significant benefits by virtually eliminating state and local taxes. These zones vary, but can mostly be placed anywhere in Michigan. Companies located within a Renaissance Zone are still responsible for federal obligations, unemployment insurance, workers’ compensation insurance, social security taxes, sewer and water fees, sales and use taxes, and certain property taxes. The Renaissance Zone benefits begin the year following designation. Benefits under Renaissance Zones are phased out in 25 percent increments over the final three years of the designation period.

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Sales Tax Exemptions: Manufacturing machinery and equipment, pollution control equipment and electricity and natural gas used in production are all exempt from sales tax.

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PA 198 Property Tax Abatement: A PA 198 certificate has the ability to reduce property taxes by 50% for manufacturers and high-technology businesses on new investments.  Applications are filed, reviewed and approved by the local unit of government, but are also subject to review by the Michigan Department of Treasury and the Michigan Economic Development Corporation (MEDC).   These abatements are approved for a period of 1-12 years by the local units of government. Businesses approved for a PA 198 abatement can also receive an exemption of the 6-mill State Education Tax.  Any SET abatement must be negotiated with the MEDC.

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State Education Tax Abatement: The state can abate half or all of the 6-mill State Education Tax on new investment when the project presents significant economic benefits to Michigan, and when the project receives a property tax abatement under PA 198 of 1974.

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Personal Property Tax Reform: Michigan is phasing out its Personal Property Tax for most businesses, including for eligible manufacturing personal property, i.e., personal property that is used more than 50% of the time in or supporting industrial processes.

The State Essential Services Assessment (SESA) is required for manufacturers that do not pay personal property tax on eligible manufacturing personal property. Projects that locate in eligible distressed areas may receive an exemption on the Assessment on $25 million or more in eligible personal property. Transformative projects that are not located in eligible distressed areas may also receive an Alternative SESA Incentive, which is equal to a 50% exemption for up to 15 years.

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Brownfield Tax Increment Financing: Through the Brownfield Redevelopment Financing Act, Brownfield TIF allows applicable taxing jurisdictions to receive property taxes on the property at the current level and capture the incremental increase in tax revenue resulting from a redevelopment project. Under an MSF approved Work Plan or Combined Plan, projects can seek reimbursement from state and local property taxes for eligible non-environmental activities. Projects can also seek reimbursement from state and local property taxes for eligible environmental activities through submission of a Work Plan or Combined Plan to the Michigan Department of Environment, Great Lakes, and Energy.

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DIRECT FINANCIAL ASSISTANCE

Michigan Community Revitalization Program: This program offers gap financing via grant, loan, loan participation, or equity investment to encourage private investment in the revitalization and redevelopment of functionally obsolete, contaminated, blighted, or historic properties. Support for a project will generally not exceed 25% of the total eligible investment, except in a town with a population of 15,000 or less, where award funds can equal to 50% of a project's total eligible investment. Three times per year, for the purpose of historic preservation, the Michigan Strategic Fund may approve up to 50% of a project’s eligible expenses (up to $10,000,000) regardless of the population of the town. A grant cannot exceed $1,500,000 for any project and an entire MCRP incentive cannot exceed $10,000,000.

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JOB TRAINING

Michigan Works!: Provides workforce development assistance to companies in the form of candidate identification and screening, training grants and programs, and internships/co-ops.

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Jobs Ready Michigan: Job training program that provides grant funds to companies relocating or expanding in Michigan. The program was created to address specific skillset needs for positions that are high-wage, high-skilled, or high-demand. Funds can be used for various job training and talent recruitment related activities.

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Last Updated: May 2023