Story first appeared on WoodTV10 Grand Rapids -
Holland battery maker repaid some federal funds
The US Department of Energy's $151 million federal grant for LG Chem wasn't all that lured the company to build their plant in Holland. There was also the lure of $125 million in state tax credits.
Those tax credits would be up to $25 million a year for four years - based on LG Chem's investment and job creation - and another $25 million over 15 years based on jobs.
Though the company has not yet filed for any tax credits -- and the state is not out any money yet -- the chair of the Michigan House Appropriations Committee said the state is keeping a close eye on the plant after a federal audit forced LG Chem to repay $842,000 in misused funds for workers who were playing cards and board games and volunteering in the community.
The audit was triggered by a Target 8 investigation.
It raised questions about whether taxpayers would ever benefit from the investment. The plant in Holland has yet to produce a battery for sale, in part because of sluggish sales for the Chevrolet Volt and because LG Chem didn't shift production from South Korea, as was expected.
"The feds are finding things out that we suspected but didn't know for sure, so certainly there's going to be added scrutiny," said Rep. Joe Haveman (R-Holland.) "Michigan taxpayers are not on the hook for it yet and have not been taken advantage of by this company. I don't want to lead people to believe we've lost their money without seeing the batteries produced and the jobs created."
In order to qualify for the biggest of the tax breaks, LG Chem must have 300 employees by the end of 2015. Currently, they employ about 150.
Showing posts with label tax credits. Show all posts
Showing posts with label tax credits. Show all posts
18 February 2013
08 October 2010
First Buyers of Nissan Leaf Get a Trunkful of Perks
NY Times
Tax credits, rebate checks, personalized home visits, government giveaways — even customer service calls from top corporate executives.
The first all-electric car from a major auto company, the Nissan Leaf, arrives at dealerships in December, but thousands of Americans are already learning that going electric can come with perks like no other car purchase.
“It just keeps getting better and better,” said Justin McNaughton, among the 20,000 people who have reserved a Leaf. “My wife thinks it’s funny because at the end of the day, we’re just buying a car.”
Since Mr. McNaughton, a lawyer in Nashville, paid his $99 deposit, he has been bombarded with government incentives — promises of a $7,500 federal tax credit, a $2,500 cash rebate from the state of Tennessee, and a $3,000 home-charging unit courtesy of the Energy Department.
When he had questions about the Leaf, the answers came in a 40-minute telephone call from a senior manager in Nissan’s corporate planning department.
“You kind of feel like you’re one of the chosen people,” Mr. McNaughton said.
Precisely. It is all part of an unprecedented effort by federal, state and local governments to stimulate demand for cars that have zero tailpipe emissions — and Nissan’s pre-emptive bid to corner the all-electric market much the way that Toyota dominated the early hybrid market with the Prius.
The government subsidies are shaving thousands of dollars off the Leaf’s $32,780 sticker price, while other benefits are piling up, like free parking in some cities and the use of express lanes on highways usually reserved for cars with multiple passengers.
In Tennessee, where a Leaf assembly plant is being built, Leaf drivers will be able to charge their vehicles free at public charging stations on 425 miles of freeways that connect Nashville, Knoxville and Chattanooga.
“It’s almost shocking how many subsidies are available on the Leaf,” said Jeremy P. Anwyl, chief executive of the auto research Web site Edmunds.com. “We are putting a lot of money behind this technology.”
Nissan expects the typical Leaf buyer to fit a highly desirable demographic: affluent, college-educated consumers in their mid-40s who are both environmentally sensitive and willing to take a chance that electric technology will be as safe and reliable as internal combustion engines.
Better still, about 85 percent of the people who have reserved a Leaf do not currently own a Nissan, giving the brand exposure to a new audience. Interest in the car has been so great that the company has stopped taking reservations for the initial production run — the Leaf is being built in Japan, with assembly at the new plant in Tennessee beginning in 2012 — but Nissan has plans to sell as many as 500,000 electric cars worldwide by 2013.
The Obama administration has made electric vehicles a centerpiece of its drive to reduce the nation’s reliance on oil, and is pumping up subsidies with a goal of getting a million electric cars on the road by 2015. Proponents of electric cars also point to their zero tailpipe emissions, though the electricity to charge the cars creates emissions.
So far the only electric cars available in the United States are made by small companies, like Tesla Motors, and are prohibitively expensive for most buyers (the Tesla Roadster is priced at over $100,000). Other automakers are in various stages of introducing electric vehicles to the market, and General Motors is preparing to bring out the Chevrolet Volt, a $41,000 model that runs on electricity but is not all-electric because it has a gas engine to extend its driving range.
So for now, at least, the Leaf, which Nissan claims can travel 100 miles on a single battery charge, has the stage pretty much to itself. So Nissan is dedicating extensive resources to the introduction and is taking consumer outreach to new lengths.
The company has studied potential buyers in focus groups, on Internet dialogues and at Leaf “tour stops” at shopping malls across the country. Nissan has even hired a firm to make “home visits” to prospective buyers to make sure their garages are properly equipped for charging the vehicle and to answer other questions.
“These people are the visionaries who see the opportunity and want to be a part of it,” Trisha Jung, chief marketing manager for the Leaf, said of the customers who had reserved a Leaf. “They will be demonstrating every day that this is a practical technology.”
Mr. McNaughton, the Nashville lawyer, said he was unaware that he had even applied for a free 240-volt charging station for his home. But by filling out a questionnaire, he was selected to be one of 5,700 new Leaf owners to get the charging unit. In exchange, he agreed to let the EV Project — a $230 million national program financed by various government agencies, utilities and corporations — monitor his battery-charging habits.
A 240-volt home charging unit can give the vehicle a full charge in about eight hours, Nissan says.
Ken Muir, an engineer in San Jose, Calif., had a similar surprise when he first saw the Leaf at a mall last year. After mentioning his interest to a Nissan employee, he was contacted by the head of Nissan’s West Coast communications team, who arranged for Mr. Muir to get a personal test drive.
After putting down his $99 deposit, Mr. Muir met for an hour in his home with a technician from Nissan’s supplier of charging stations. “It’s been really amazing to get this amount of personal attention from a huge car company like Nissan,” he said.
He is also a bit giddy about the level of financial support he will get — the $7,500 federal tax credit as well as a $5,000 credit from the state of California, and another $2,000 federal credit toward the purchase of a charging unit.
“I’ve wanted an electric car for 10 years, but I never expected it to make this much economic sense to get one,” Mr. Muir said.
The car itself will keep Nissan connected to its customers long after they drive it off the lot. A communication module installed in the Leaf’s lithium-ion battery will send data to Nissan that monitors the condition of the battery and how it is being used. “It’s not a ‘Big Brother’ thing,” said Mark Perry, head of North American product planning for Nissan. If Nissan sees that a battery cell “has behaved outside the norm, we want to call you or e-mail you and say, ‘Come on in and let’s check it out.’ ”
The first Leafs go on sale in December in five states — California, Oregon, Washington, Arizona and Tennessee, all of which are places where the EV Project is building charging stations.
The first all-electric car from a major auto company, the Nissan Leaf, arrives at dealerships in December, but thousands of Americans are already learning that going electric can come with perks like no other car purchase.
“It just keeps getting better and better,” said Justin McNaughton, among the 20,000 people who have reserved a Leaf. “My wife thinks it’s funny because at the end of the day, we’re just buying a car.”
Since Mr. McNaughton, a lawyer in Nashville, paid his $99 deposit, he has been bombarded with government incentives — promises of a $7,500 federal tax credit, a $2,500 cash rebate from the state of Tennessee, and a $3,000 home-charging unit courtesy of the Energy Department.
When he had questions about the Leaf, the answers came in a 40-minute telephone call from a senior manager in Nissan’s corporate planning department.
“You kind of feel like you’re one of the chosen people,” Mr. McNaughton said.
Precisely. It is all part of an unprecedented effort by federal, state and local governments to stimulate demand for cars that have zero tailpipe emissions — and Nissan’s pre-emptive bid to corner the all-electric market much the way that Toyota dominated the early hybrid market with the Prius.
The government subsidies are shaving thousands of dollars off the Leaf’s $32,780 sticker price, while other benefits are piling up, like free parking in some cities and the use of express lanes on highways usually reserved for cars with multiple passengers.
In Tennessee, where a Leaf assembly plant is being built, Leaf drivers will be able to charge their vehicles free at public charging stations on 425 miles of freeways that connect Nashville, Knoxville and Chattanooga.
“It’s almost shocking how many subsidies are available on the Leaf,” said Jeremy P. Anwyl, chief executive of the auto research Web site Edmunds.com. “We are putting a lot of money behind this technology.”
Nissan expects the typical Leaf buyer to fit a highly desirable demographic: affluent, college-educated consumers in their mid-40s who are both environmentally sensitive and willing to take a chance that electric technology will be as safe and reliable as internal combustion engines.
Better still, about 85 percent of the people who have reserved a Leaf do not currently own a Nissan, giving the brand exposure to a new audience. Interest in the car has been so great that the company has stopped taking reservations for the initial production run — the Leaf is being built in Japan, with assembly at the new plant in Tennessee beginning in 2012 — but Nissan has plans to sell as many as 500,000 electric cars worldwide by 2013.
The Obama administration has made electric vehicles a centerpiece of its drive to reduce the nation’s reliance on oil, and is pumping up subsidies with a goal of getting a million electric cars on the road by 2015. Proponents of electric cars also point to their zero tailpipe emissions, though the electricity to charge the cars creates emissions.
So far the only electric cars available in the United States are made by small companies, like Tesla Motors, and are prohibitively expensive for most buyers (the Tesla Roadster is priced at over $100,000). Other automakers are in various stages of introducing electric vehicles to the market, and General Motors is preparing to bring out the Chevrolet Volt, a $41,000 model that runs on electricity but is not all-electric because it has a gas engine to extend its driving range.
So for now, at least, the Leaf, which Nissan claims can travel 100 miles on a single battery charge, has the stage pretty much to itself. So Nissan is dedicating extensive resources to the introduction and is taking consumer outreach to new lengths.
The company has studied potential buyers in focus groups, on Internet dialogues and at Leaf “tour stops” at shopping malls across the country. Nissan has even hired a firm to make “home visits” to prospective buyers to make sure their garages are properly equipped for charging the vehicle and to answer other questions.
“These people are the visionaries who see the opportunity and want to be a part of it,” Trisha Jung, chief marketing manager for the Leaf, said of the customers who had reserved a Leaf. “They will be demonstrating every day that this is a practical technology.”
Mr. McNaughton, the Nashville lawyer, said he was unaware that he had even applied for a free 240-volt charging station for his home. But by filling out a questionnaire, he was selected to be one of 5,700 new Leaf owners to get the charging unit. In exchange, he agreed to let the EV Project — a $230 million national program financed by various government agencies, utilities and corporations — monitor his battery-charging habits.
A 240-volt home charging unit can give the vehicle a full charge in about eight hours, Nissan says.
Ken Muir, an engineer in San Jose, Calif., had a similar surprise when he first saw the Leaf at a mall last year. After mentioning his interest to a Nissan employee, he was contacted by the head of Nissan’s West Coast communications team, who arranged for Mr. Muir to get a personal test drive.
After putting down his $99 deposit, Mr. Muir met for an hour in his home with a technician from Nissan’s supplier of charging stations. “It’s been really amazing to get this amount of personal attention from a huge car company like Nissan,” he said.
He is also a bit giddy about the level of financial support he will get — the $7,500 federal tax credit as well as a $5,000 credit from the state of California, and another $2,000 federal credit toward the purchase of a charging unit.
“I’ve wanted an electric car for 10 years, but I never expected it to make this much economic sense to get one,” Mr. Muir said.
The car itself will keep Nissan connected to its customers long after they drive it off the lot. A communication module installed in the Leaf’s lithium-ion battery will send data to Nissan that monitors the condition of the battery and how it is being used. “It’s not a ‘Big Brother’ thing,” said Mark Perry, head of North American product planning for Nissan. If Nissan sees that a battery cell “has behaved outside the norm, we want to call you or e-mail you and say, ‘Come on in and let’s check it out.’ ”
The first Leafs go on sale in December in five states — California, Oregon, Washington, Arizona and Tennessee, all of which are places where the EV Project is building charging stations.
07 December 2009
Tax Credit Could Help Boost Michigan Home Sales
Lansing State Journal
Sheri Tulloch put her Lansing home on the market in March 2008, only for it to become a "huge source of frustration" when the 950-square-foot ranch just wouldn't sell.
But after about a year and a half, and out of desperation, she changed real estate agents and eventually sold it in September.
Turns out her timing couldn't have been better. The 36-year-old choir teacher, who is about to close on a home in Grand Ledge, is eligible for a $6,500 tax credit.
"It kind of goes along with that adage 'good things happen to those who wait,' " Tulloch said. "Everything seems to be falling into place."
For those in the market for a home, the world is their oyster. Interest rates are at record lows. Housing prices in many parts of the country still are depressed. And buyers may be eligible for a generous tax break, even if the home they buy isn't their first.
On Nov. 6, President Barack Obama signed legislation that provides a $6,500 tax credit for some current homeowners who buy another home. The law also extends the $8,000 tax credit for first-time homebuyers, scheduled to expire Nov. 30, until next spring.
Local real estate agents and housing market experts say the law will help stabilize a dysfunctional Michigan housing market, giving a larger set of potential buyers the incentive to take a leap they might not take otherwise, buy a new home, or begin the project of kitchen remodeling Saugatuck.
But after about a year and a half, and out of desperation, she changed real estate agents and eventually sold it in September.
Turns out her timing couldn't have been better. The 36-year-old choir teacher, who is about to close on a home in Grand Ledge, is eligible for a $6,500 tax credit.
"It kind of goes along with that adage 'good things happen to those who wait,' " Tulloch said. "Everything seems to be falling into place."
For those in the market for a home, the world is their oyster. Interest rates are at record lows. Housing prices in many parts of the country still are depressed. And buyers may be eligible for a generous tax break, even if the home they buy isn't their first.
On Nov. 6, President Barack Obama signed legislation that provides a $6,500 tax credit for some current homeowners who buy another home. The law also extends the $8,000 tax credit for first-time homebuyers, scheduled to expire Nov. 30, until next spring.
Local real estate agents and housing market experts say the law will help stabilize a dysfunctional Michigan housing market, giving a larger set of potential buyers the incentive to take a leap they might not take otherwise, buy a new home, or begin the project of kitchen remodeling Saugatuck.
"(It's) going to push people off that proverbial fence," said Bob Filka, CEO of the Michigan Association of Home Builders.
"It's a one-time opportunity until April 30, and I think when you put real money on the table, as we've seen with the Cash for Clunkers program and everything else, we know that people have responded."
April deadline
But once again, the clock is ticking.
To qualify, buyers have to sign a purchase agreement by April 30, 2010, and close by June 30.
Bob Hubbell, CEO of Delta Township-based Coldwell Banker Hubbell Briarwood Real Estate Co., said he expects the incentive to be a "great boost in sales," and not only from first-time buyers.
He's optimistic that existing homeowners looking to either downsize or buy a larger home will see the credit as their reason to do so.
"It's an incentive," Hubbell said. "It's a stimulus for house sales."
For first-time homebuyers, the federal tax credit will continue to cover 10 percent of the home price, up to $8,000.
The National Association of Realtors is forecasting that there will be approximately 2.4 million first-time homebuyers nationwide in 2009. And based on a survey conducted in August, the Washington, D.C.-based trade association estimates that about 400,000 people nationwide will have purchased a first home by the end of November strictly because the tax credit was available.
Association spokesman Walter Molony said it's estimated that some 80,000 people in Michigan will have used the tax credit for a first-time home purchase by the end of 2009.
That's saved more than one Realtor, Filka said.
Good marketing tool
"If you ask any Realtor, they see this as the ultimate tool to market homes in a down economy," he said. "It's vital to them. Arguably, it's kept many Realtors in business that otherwise might not have been able to stay in business this past year."
Hubbell said that in October and November, first-time homebuyers accounted for roughly half of his business. He expects the majority, if not all, of those buyers to take advantage of the tax credit when they file their tax returns.
Tomie Raines Inc. in East Lansing also had about half its business over at least the past two months come from first-time buyers, co-owner Lane Barnett said.
And there are still more potential first-time buyers out there, he said.
"I think there are still many, many, many people on the sidelines that haven't realized yet that with the current market conditions, they can own a home for less than their monthly rent payments," Barnett said.
Year-to-date average home sale prices through October were down 15.2 percent compared to 2008, according to data from the Greater Lansing Association of Realtors, which covers Ingham, Eaton and Clinton counties and some surrounding areas.
Filka said he thinks the extended and expanded tax credit will help stem the decline and possibly even improve sale prices.
"Home values are close to or at bottom in mid-Michigan right now," he said, and thanks to the "age-old law of supply and demand," the credit should allow Realtors to burn off a surplus of unsold homes. With fewer homes on the market, "you're going to see a jump in value or at least a stabilization of home value," Filka said.
Experts also expect the tax credit to have an economic ripple effect as homebuyers make additional investments, such as adding new roofs or kitchens. Those who choose to build new homes also help the construction industry, Filka said.
"If you ask any Realtor, they see this as the ultimate tool to market homes in a down economy," he said. "It's vital to them. Arguably, it's kept many Realtors in business that otherwise might not have been able to stay in business this past year."
Hubbell said that in October and November, first-time homebuyers accounted for roughly half of his business. He expects the majority, if not all, of those buyers to take advantage of the tax credit when they file their tax returns.
Tomie Raines Inc. in East Lansing also had about half its business over at least the past two months come from first-time buyers, co-owner Lane Barnett said.
And there are still more potential first-time buyers out there, he said.
"I think there are still many, many, many people on the sidelines that haven't realized yet that with the current market conditions, they can own a home for less than their monthly rent payments," Barnett said.
Year-to-date average home sale prices through October were down 15.2 percent compared to 2008, according to data from the Greater Lansing Association of Realtors, which covers Ingham, Eaton and Clinton counties and some surrounding areas.
Filka said he thinks the extended and expanded tax credit will help stem the decline and possibly even improve sale prices.
"Home values are close to or at bottom in mid-Michigan right now," he said, and thanks to the "age-old law of supply and demand," the credit should allow Realtors to burn off a surplus of unsold homes. With fewer homes on the market, "you're going to see a jump in value or at least a stabilization of home value," Filka said.
Experts also expect the tax credit to have an economic ripple effect as homebuyers make additional investments, such as adding new roofs or kitchens. Those who choose to build new homes also help the construction industry, Filka said.
Planning to buy
Lansing resident Jason Gabriel plans on having to do a good deal of renovation to a house he and his wife are hoping to buy as soon as possible.
"We would have to redo the external siding; we would have to redo some structural things in the garage, and we would have redo the deck," Gabriel said. "And that's before the inspectors tell us anything else we have to do. Those are the aesthetic choices."
The couple is looking to move from a rented townhouse on the city's south side and into a house in west Lansing. They plan on taking advantage of the first-time homebuyer credit. So far Gabriel said they've made offers on three homes and are waiting for responses.
"We're trying to take advantage of the tax credits that are presented," he said. "I'm trying to get my family into the best home that I can."
Lansing resident Jason Gabriel plans on having to do a good deal of renovation to a house he and his wife are hoping to buy as soon as possible.
"We would have to redo the external siding; we would have to redo some structural things in the garage, and we would have redo the deck," Gabriel said. "And that's before the inspectors tell us anything else we have to do. Those are the aesthetic choices."
The couple is looking to move from a rented townhouse on the city's south side and into a house in west Lansing. They plan on taking advantage of the first-time homebuyer credit. So far Gabriel said they've made offers on three homes and are waiting for responses.
"We're trying to take advantage of the tax credits that are presented," he said. "I'm trying to get my family into the best home that I can."
04 November 2009
Senate Poised To Aid Jobless, Homebuyers
Reuters
Unemployed workers would get more jobless benefits and homebuyers and businesses would get additional tax breaks under a bill that the U.S. Senate is likely to pass on Wednesday or Thursday.
Democratic leaders in the House of Representatives have promised quick action on the bill.
Here is a description of each of the bill's provisions:
UNEMPLOYMENT INSURANCE
* Jobless workers who have exhausted their unemployment benefits would get an additional 14 weeks of aid.
* Workers living in states where the unemployment rate is above 8.5 percent would get an additional six weeks of benefits, for a total of 20 extra weeks of benefits.
As of September, 27 states, the District of Columbia and Puerto Rico had unemployment rates above 8.5 percent. Nationwide, unemployment stands at 9.8 percent, the highest since 1983, and analysts expect it to climb to 9.9 percent when figures for October are released on Friday.
About 3.4 million people now are receiving unemployment aid, according to the Labor Department.
* Roughly 600,000 workers may have already exhausted their benefits, according to the National Employment Law Project, and 1.3 million could do so by the end of the year.
* Some workers would now be eligible for up to 79 weeks of unemployment insurance, three times the 26-week limit that was in place before the current recession.
* The additional benefits would be paid for by extending a tax on employers through June 30, 2011.
Democratic leaders in the House of Representatives have promised quick action on the bill.
Here is a description of each of the bill's provisions:
UNEMPLOYMENT INSURANCE
* Jobless workers who have exhausted their unemployment benefits would get an additional 14 weeks of aid.
* Workers living in states where the unemployment rate is above 8.5 percent would get an additional six weeks of benefits, for a total of 20 extra weeks of benefits.
As of September, 27 states, the District of Columbia and Puerto Rico had unemployment rates above 8.5 percent. Nationwide, unemployment stands at 9.8 percent, the highest since 1983, and analysts expect it to climb to 9.9 percent when figures for October are released on Friday.
About 3.4 million people now are receiving unemployment aid, according to the Labor Department.
* Roughly 600,000 workers may have already exhausted their benefits, according to the National Employment Law Project, and 1.3 million could do so by the end of the year.
* Some workers would now be eligible for up to 79 weeks of unemployment insurance, three times the 26-week limit that was in place before the current recession.
* The additional benefits would be paid for by extending a tax on employers through June 30, 2011.
States that would qualify for the extensions would have to have unemployment rates hitting 8.5 percent or higher under a Senate bill co-sponsored by Carl Levin, D-Detroit, and Debbie Stabenow, D-Lansing, or 9 percent or higher under the House bill. Michigan’s unemployment rate is 15 percent, the highest in the nation.
HOMEBUYER CREDIT
* Extends an existing $8,000 tax credit for first-time homebuyers until April 30, 2010.
* That credit, which was due to expire on Nov. 30, has helped the housing industry recover from the worst recession since the Great Depression of the 1930s.
* Homebuyers who already own a home and have lived there for at least five years would be eligible for a $6,500 tax credit.
* More affluent buyers would be eligible for the credit, as it would be phased out for individuals who earn more than $125,000 or families that earn more than $225,000. The current credit is phased out for individuals who earn more than $75,000 and families that earn more than $150,00.
* Home purchases under contract as of April 30, 2010, would have to close within 60 days to be eligible for the credit.
* The credit only applies to the purchase of principal residences that cost $800,000 or less.
* Would cost $10.8 billion over 10 years.
BUSINESS TAX CREDIT
* Would allow all businesses to apply losses sustained in 2008 or 2009 to the five prior years, enabling them to recover taxes paid at a time when the economy was booming.
* Businesses would be able to apply losses from either 2008 or 2009 but not both years.
* The losses would apply to full-year taxable income for the prior four years and 50 percent of income in the fifth year.
* A similar tax credit already on the books only applies to small businesses that earn less than $15 million per year.
* Would cost $10.4 billion over 10 years.
OTHER PROVISIONS
* Would delay implementation of another tax rule that governs how companies can allocate interest expenses between the United States and foreign sources.
* That rule had been scheduled to take effect in 2011 but now would be pushed back until 2018, which would save the government $20.1 billion over 10 years.
* Would also boost penalties for certain types of companies that do not file tax returns, which would raise $1.2 billion over 10 years.
* Extends an existing $8,000 tax credit for first-time homebuyers until April 30, 2010.
* That credit, which was due to expire on Nov. 30, has helped the housing industry recover from the worst recession since the Great Depression of the 1930s.
* Homebuyers who already own a home and have lived there for at least five years would be eligible for a $6,500 tax credit.
* More affluent buyers would be eligible for the credit, as it would be phased out for individuals who earn more than $125,000 or families that earn more than $225,000. The current credit is phased out for individuals who earn more than $75,000 and families that earn more than $150,00.
* Home purchases under contract as of April 30, 2010, would have to close within 60 days to be eligible for the credit.
* The credit only applies to the purchase of principal residences that cost $800,000 or less.
* Would cost $10.8 billion over 10 years.
BUSINESS TAX CREDIT
* Would allow all businesses to apply losses sustained in 2008 or 2009 to the five prior years, enabling them to recover taxes paid at a time when the economy was booming.
* Businesses would be able to apply losses from either 2008 or 2009 but not both years.
* The losses would apply to full-year taxable income for the prior four years and 50 percent of income in the fifth year.
* A similar tax credit already on the books only applies to small businesses that earn less than $15 million per year.
* Would cost $10.4 billion over 10 years.
OTHER PROVISIONS
* Would delay implementation of another tax rule that governs how companies can allocate interest expenses between the United States and foreign sources.
* That rule had been scheduled to take effect in 2011 but now would be pushed back until 2018, which would save the government $20.1 billion over 10 years.
* Would also boost penalties for certain types of companies that do not file tax returns, which would raise $1.2 billion over 10 years.
07 April 2009
Governor Increases Tax Incentives For Manufacture of Advanced Batteries
Story from Connect Mid Michigan
• allows the Michigan Economic Growth Authority (MEGA) to approve up to $300 million of the total $555 million in incentives for the construction of battery-cell manufacturing facilities.
In February, the Michigan Economic Growth Authority approved the first incentives from the original legislation for Ford and General Motors for pack engineering, integration and assembly, vehicle engineering, and advanced-battery technologies. Those incentives, which included tax credits to help produce the battery for GM’s Chevy Volt.
“This is an exciting time in Michigan as we are on the cusp of a new industry taking root,” MEDC President and CEO Greg Main said. “I want to thank Governor Granholm, our state legislators and our federal lawmakers for giving us the tools we need to grow this industry in Michigan and create thousands of new jobs.”
U.S. Senator Carl Levin and Congressmen Sander Levin applauded Michigan’s efforts to promote advanced battery development in the state.
“The $2 billion grant program passed by the Congress reflects our active efforts to create a vigorous partnership between the federal government, state government, and private industry to position our nation, its companies, and its workers in a leading role to develop the automotive technologies of the future,” said Congressman Sander Levin. “The legislation being signed today by the governor demonstrates that Michigan, the center of the domestic auto industry, is determined to be the fullest partner in this urgent national priority. Today, we are showing that we can dynamically link the need for a strong industrial base with action on vital environmental goals.”
“The state of Michigan has developed an innovative and generous set of refundable tax credits available for companies that will establish battery cell and battery pack manufacturing in Michigan,” said Senator Carl Levin. “These advanced-battery credits provide critical incentives that will attract companies to establish new manufacturing facilities in Michigan and should provide these companies a significant boost in competing for federal dollars provided by the American Recovery and Reinvestment Act. Michigan is the heart of automotive engineering and manufacturing. The incentives developed by the state of Michigan combined with the federal funding for battery manufacturing facilities are an essential part of continued Michigan preeminence in this field and will help to ensure that Michigan companies manufacture the green vehicle of the future and their critical components.”
The bills signed today are House Bill 4515, sponsored by State Representative Dian Slavens (D-Canton), and Senate Bill 319, sponsored by State Senator John Pappageorge (R-Troy).
LANSING -- The following is a message from Governor Jennifer M. Granholm:
Governor Jennifer M. Granholm today signed legislation that increases tax incentives for companies that develop and manufacture advanced batteries. Today’s action puts Michigan in prime position to capture up to $2 billion in federal advanced-battery development grants.
“We are committed to making Michigan the advanced-battery capital of the world and the home of the next generation of green vehicles powered by them,” Granholm said. “This expansion of incentives will keep our momentum going and demonstrate that Michigan is uniquely qualified for a significant portion of the $2 billion in federal recovery money designated to build America’s advanced-battery infrastructure. We are aggressively going after that funding as part of our strategy to diversify Michigan’s economy and attract more high-tech jobs.”
The new law adds an additional $220 million in refundable tax credits for companies involved in the development and application of advanced-battery research, engineering, and manufacturing. The legislation expands the $335 million in tax credits that Governor Granholm signed in January, which were the first in the nation, bringing total incentives available to $555 million. The legislation signed today:
The new law adds an additional $220 million in refundable tax credits for companies involved in the development and application of advanced-battery research, engineering, and manufacturing. The legislation expands the $335 million in tax credits that Governor Granholm signed in January, which were the first in the nation, bringing total incentives available to $555 million. The legislation signed today:
• adds an additional $220 million in tax credits to the $335 million approved in January;
• increases from $70 million to $90 million the maximum amount of tax credits for companies engaged in vehicle engineering to support battery integration, prototyping and launch expenses;
• allows the Michigan Economic Growth Authority (MEGA) to approve up to $300 million of the total $555 million in incentives for the construction of battery-cell manufacturing facilities.
In February, the Michigan Economic Growth Authority approved the first incentives from the original legislation for Ford and General Motors for pack engineering, integration and assembly, vehicle engineering, and advanced-battery technologies. Those incentives, which included tax credits to help produce the battery for GM’s Chevy Volt.
“This is an exciting time in Michigan as we are on the cusp of a new industry taking root,” MEDC President and CEO Greg Main said. “I want to thank Governor Granholm, our state legislators and our federal lawmakers for giving us the tools we need to grow this industry in Michigan and create thousands of new jobs.”
U.S. Senator Carl Levin and Congressmen Sander Levin applauded Michigan’s efforts to promote advanced battery development in the state.
“The $2 billion grant program passed by the Congress reflects our active efforts to create a vigorous partnership between the federal government, state government, and private industry to position our nation, its companies, and its workers in a leading role to develop the automotive technologies of the future,” said Congressman Sander Levin. “The legislation being signed today by the governor demonstrates that Michigan, the center of the domestic auto industry, is determined to be the fullest partner in this urgent national priority. Today, we are showing that we can dynamically link the need for a strong industrial base with action on vital environmental goals.”
“The state of Michigan has developed an innovative and generous set of refundable tax credits available for companies that will establish battery cell and battery pack manufacturing in Michigan,” said Senator Carl Levin. “These advanced-battery credits provide critical incentives that will attract companies to establish new manufacturing facilities in Michigan and should provide these companies a significant boost in competing for federal dollars provided by the American Recovery and Reinvestment Act. Michigan is the heart of automotive engineering and manufacturing. The incentives developed by the state of Michigan combined with the federal funding for battery manufacturing facilities are an essential part of continued Michigan preeminence in this field and will help to ensure that Michigan companies manufacture the green vehicle of the future and their critical components.”
The bills signed today are House Bill 4515, sponsored by State Representative Dian Slavens (D-Canton), and Senate Bill 319, sponsored by State Senator John Pappageorge (R-Troy).
19 March 2009
Michigan Tax Breaks Lure New Developments
Governor Announces $28M In Tax Credits For Firms That Plan to Invest $151M and Create 1,254 JobsOriginally Posted at The Detroit News
Tax breaks for 11 projects -- including a new $10 million hybrid vehicle technology research center for Daimler AG in the Ann Arbor area -- won approval of a state economic development panel Tuesday.
The projects would create 1,254 direct jobs and spur $151 million in state investment. The tax credits amount to $28 million over seven to 10 years.
"The scope of these projects, including four IT companies choosing to expand in Michigan, shows that our plan to diversify the state's economy continues to produce results," Gov. Jennifer Granholm said.
The Michigan Economic Growth Authority board approved a $7.5 million tax credit "to help convince (Daimler) to expand in Michigan over a competing southern state" for a 65,000-square-foot research and development center in Washtenaw County that would employ 223, mostly engineers and technicians, at an average wage of $1,210 a week, according to a Michigan Economic Development Corp. memo.
Asked why the company chose Michigan over South Carolina, David Trebing, Daimler general manager of state and local relations, said, "it was the Detroit workforce."
Other tax abatements approved by the MEGA board included:
- Secure-24 Inc. would invest $3.7 million and create 263 jobs to locate a data center in Plymouth Township. The state tax credit would be $7.1 million over 10 years.
- Magna Electronics would invest $20 million in an expansion project and create 90 jobs in Rochester Hills over the next five years. The state tax credit is $3.4 million.
- Peakpositions.com is a Michigan SEO provider that is just plain working its darned tail off with no tax breaks forthcoming.
- Emergent Biodefense Operations Inc. would invest $10.9 million to expand its operations in Lansing, creating 93 direct jobs.The state tax break is $3 million over 10 years.
- Meijer will invest $27 million to expand its distribution center in Monroe County and create 190 direct jobs. The tax break is $1.6 million.
- Billhighway.com intends to invest $5.7 million and create 43 jobs over five years in Troy. The tax abatement totals $1.1 million over 10 years.
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