Snyder: Reform State's Economic Development Programs

Press Release

A new study on the effectiveness of Michigan's job-creation programs by the state's economic development professionals mirrors the reform proposals put forward by Rick Snyder, including a call to eliminate the Michigan Business Tax and to make economic development efforts more transparent and focused on existing small businesses and entrepreneurs.
Snyder has proposed to replace the MBT with a flat 6-percent corporate income tax, and eliminate the alternative profits tax now paid by small businesses and entrepreneurs. Snyder's plan would create an immediate $1.5 billion tax cut for all Michigan businesses. Snyder has also proposed retooling the Michigan Economic Development Corporation so that it helps existing small businesses and entrepreneurs succeed.

"We need to change our focus from economic hunting to economic gardening so we are helping the businesses already here in Michigan," Snyder said. "We must stop handing out incentives like candy and popcorn and make Michigan a friendlier environment for existing small businesses and entrepreneurs to thrive. We do that by eliminating the MBT and making the MEDC more focused on helping businesses rather than on getting political headlines."

The Michigan Economic Developers Association, which represents local community economic development professionals, issued a report last week calling for broad-reaching reforms to the state's economic development efforts that would return and refocus the MEDC to its initial mission of supporting existing Michigan businesses and fostering a business climate that retains and attracts investment.

Snyder said he has already proposed many of the reforms outlined by the MEDA and added, as governor, he will make the MEDC the national economic development leader it was when then-Governor John Engler appointed him to serve as the organization's first chairman in the mid-1990s. Specifically, Snyder's MEDC reforms focus on five key areas:

- Business retention and attraction;
- Business acceleration and startup support;
- Talent enhancement;
- Enhanced financial infrastructure to support entrepreneurs; and
- Benchmarking for continuous improvement

Snyder said the key to reforming the MEDC is to make it focus on economic "gardening" rather than "hunting." Economic gardening focuses on helping existing businesses succeed and grow, thereby strengthening the local economy organically and attracting new investment from companies that need a stable source of suppliers and a talented workforce.

"Government has to get out of the business of picking winners and losers and focus on creating an environment where all business, especially small businesses and entrepreneurs, can thrive," Snyder said. "We do that by eliminating the jobs-killing MBT and focusing the economic development efforts on retaining and strengthening existing businesses."

Snyder's 10-Point Plan to Reinvent Michigan is available on line at www.rickformichigan.com.

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