November 17, 2005

LANSING – Governor Jennifer M. Granholm today vetoed legislation that would move the state toward a policy that grants unfocused and fiscally undisciplined tax abatements with no promise of creating new jobs.  In doing so, she urged lawmakers to stand by their practice of approving targeted programs that will result in new jobs. 
 
“I have not hesitated to support tax credits, exemptions, and abatements focused on providing incentives for the creation and retention of good paying jobs that give the residents of this state a fair opportunity to prosper,” Granholm wrote in her veto message.  “Just within the last two months, I have approved Public Acts 118 and 185 of 2005 – new laws offering targeted and aggressive assistance for providers of high-quality jobs.”
 
Granholm said today’s veto could have been avoided had Republican leaders accepted her targeted and viable compromise on the bill to pave the way for a company seeking to locate in St. Joseph County.  The Granholm compromise would have provided targeted tax abatements to job providers locating within 15 miles of a Michigan border.  That compromise acknowledged the competition for warehousing business along Michigan borders where communities must compete against Ohio, Wisconsin, and Indiana tax incentives.
 
Granholm said the legislative leadership’s decision stands in marked contrast to their approval of targeted tax breaks for companies, including companies locating in Delta Township (PA 118 of 2005) and Cadillac (PA 185 of 2005).  
 
“Proponents assert that Senate Bill 175 would authorize tax abatements to address competitive disadvantages faced by Michigan communities near the Indiana border seeking to attract commercial warehousing and distribution centers,” Granholm said.  “However, the provisions of the bill go well beyond that stated purpose.”
 
Granholm is urging lawmakers to take up her compromise and send her legislation that will create jobs by allowing border communities to better compete with their neighbors in other states.

# # #