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Governor Granholm Joins Rep. Steve Bieda to Keep State Contracting Jobs in Michigan, U.S.

March 22, 2004

LANSING – At an event at Macomb County Community College to illustrate the impact that outsourcing of jobs has had on a community, Governor Jennifer M. Granholm today signed two executive directives designed to keep jobs related to state government contracts and services in Michigan.  Joining Granholm at the event was State Representative Steve Bieda (D-Warren) who is sponsoring legislation to address outsourcing in the Michigan House of Representatives.

“Today, I have signed two executive directives that will ensure that Michigan taxpayers are not subsidizing the export of jobs,” Granholm said.  “I commend Representative Bieda and his House Democratic colleagues on their efforts to focus on how we can stop the practice of outsourcing jobs at this critical time when our economy needs every job we can provide or create for a Michigan resident.”
Executive Directive 2004-2 prohibits state departments and agencies from spending state or federal funds to provide a financial incentive to induce a business located in the United States to relocate out of the country, if shifting production offshore will reduce jobs for U.S. workers.  It also prohibits departments and agencies from spending state appropriated funds to induce a business located in Michigan to relocate out-of-state, if shifting production elsewhere will reduce jobs for Michigan workers.
Finally, the directive also will prohibit state departments and agencies from providing assistance for any program, project, or activity contributing to the violation of internationally-recognized workers’ rights.

“This directive is a preventive measure to make sure that Michigan is in alignment with recent changes in federal law regarding restrictions on the spending of federal funds,” Granholm said. “There are no indications currently that state or federal funds have been used by state agencies to provide incentives for relocating jobs or violating workers’ rights.”

Governor Granholm also signed Executive Directive 2004-3, which gives preferences to Michigan-based job providers in the state government contracting process and, for the first time, requires the Department of Management and Budget (DMB) to consider whether or not a bidder is engaged in exporting jobs or in using an offshore tax shelter when determining if a bidder’s proposal provides the best overall value to the state.  Under the ED, the department will now collect information from all vendors relating to job outsourcing.

“The State of Michigan must extend legal preferences for Michigan-produced goods and services over those of other states and countries,” Granholm said.  “The procurement process for state government should include provisions that take the state’s best interests, including the economy and supporting American jobs, into consideration when a purchase is made or a contract is let.”

Currently, 24 other states provide for some form of legal preference for in-state bidders or products.  Provisions in Michigan law currently provide for preferences for Michigan-based businesses bidding to provide goods or services to the State of Michigan, but those provisions have not been actively enforced in the past.
Directive 2004-3 requires DMB to provide information to Michigan businesses on how to become certified as a Michigan-based business.
“Representative Bieda’s leadership on this issue has helped propel it to the forefront in Michigan, and state government is responding,” Granholm said.  “The state will invigorate its efforts to ‘buy Michigan,’ and vendors who do not disclose their outsourcing activities to us will be barred from doing state business.  This is a strong stand to protect Michigan and U.S. jobs from being sent overseas, something we can ill afford in this anemic national job recovery.”
Forrester Research, an independent technology researcher, predicts at least 3.3 million service jobs and $136 billion in wages will shift outside of the U.S. to low-cost countries by 2015.