On July 26, 2017, Governor Rick Snyder enacted Senate Bill 242 into law. This program, commonly referred to as the Good Jobs for Michigan bill, is designed to incentivize businesses to create large-scale employment that pays above-average wages. The program will allow for a refund to the company of personal income tax withholdings on qualified new employees. This law is effective immediately and may be utilized in conjunction with other economic development incentives.
The Good Jobs for Michigan program contains two tiers of eligibility. In the first tier, businesses that create a minimum of 500 new jobs and pay wages at or above the regional average wage would be eligible to capture up to 50% of the personal income tax withholdings of the new employees for up to five years. In the second tier, businesses that create a minimum of 250 new jobs and pay wages at 125% or more of the regional average wage would be eligible to capture up to 100% of the personal income tax withholdings of the new employees for a period up to ten years. Before receiving an annual disbursement, companies will be required to comply with headcount and wage verification every year until the expiration of their contract.
The program has a cap of 15 projects per year, with a rolling cap of $200 million for all projects. If the fund approves fewer than 15 written agreements in a year or if a company forfeits any portion, the unused funds may carry forward into future calendar years.
Companies considering Michigan for investment and hiring should act soon, given the competitive nature of the program.
TECHNICAL INFORMATION CONTACT:
Paul Lo
Director
Ryan
212.871.3901
paul.lo@ryan.com