The Michigan Economic Development Corporation (MEDC) has approved Michigan Strategic Fund (MSF) projects that will boost Michigan’s global leadership in the automotive industry and also expand its commitment to transforming underutilized properties into vibrant spaces. In total, the projects are expected to generate nearly $3.6 billion of capital investment and support the creation of at least 741 new jobs in Michigan.
“Today’s MSF actions build on the major investments made in Michigan’s automotive and mobility strengths over the past year, indicating our state’s continued leadership in driving future transportation solutions,” said Jeff Mason, CEO of MEDC, the state’s chief marketing and business attraction agency, responsible for enabling long-term economic opportunity for all Michiganders.
“Additionally, these community revitalization projects will drive sustainable and long-term vibrancy to neighborhoods throughout Detroit,” Mason said.
The MSF approved amendments to the Global Retention MEGA tax credit agreement with General Motors that will support the company’s continued investment in Michigan and ensure the state’s position as a leader in automotive design, manufacturing and future mobility. The amendments will enable the company to have more flexibility to manage its operations within Michigan and will signify GM’s commitment to developing electric vehicles and future mobility solutions in Michigan for the long term.
GM has committed to invest at least $3.5 billion in Michigan over the next 10 years including a significant investment at its Detroit Hamtramck facility, which will be the future home of a newly announced battery electric truck and other electric vehicles. The investment will eventually result in new employment opportunities at the facility and elsewhere in the state.
To support GM’s commitments, the MSF approved the following:
- Requiring GM to invest at least $3.5 billion in Michigan over the next 10 years, including an investment at the Detroit Hamtramck facility;
- Reducing the maximum credit benefit on the remaining value of the company’s Global Retention MEGA credit term by $325 million for a remaining credit value of $2.27 billion;
- Adding annual caps for the remaining credit term (through Dec. 31, 2029);
- An agreement to terminate the company’s MEGA credit at its Brownstown Township facility, reducing the state’s liability by $4.1 million;
- Increasing the average weekly wage from $650 to $1,300 statewide for the remaining credit term;
- Allowing for statewide job retention rather than limiting it to certain locations.
Dakkota Integrated Systems, LLC plans to construct and operate a 300,000-square-foot manufacturing facility on a portion of the former Kettering High School and Rose Elementary School sites in the city of Detroit. The new facility will supply suspension assemblies and instrument panel assemblies in support of FCA’s production of the Jeep Grand Cherokee and Jeep Grand Wagoneer, as well as other future business via multimodal commerce including truck and rail.
The project is expected to generate a total capital investment of up to $45 million in the city of Detroit and create 400 jobs. As a result, the company has been awarded a $1.5 million Michigan Business Development Program grant and has been approved as a Next Michigan Business within the boundaries of the Detroit Next Michigan Development Corporation Renaissance Zone for a period of 15 years estimated to be worth $3.5 million. Dakkota Integrated Systems chose Michigan for the project over competing sites in Ohio and Canada.
“We are excited to bring manufacturing jobs to the east side of Detroit. Our mission is to create high quality jobs and develop top talent, while exceeding our customers’ expectations and helping them win the marketplace. We are proud to support FCA, help a Detroit neighborhood thrive, and showcase world-class quality auto parts built by hardworking Detroiters,” said Dakkota Integrated Systems CEO and President Andra Rush. “Dakkota appreciates the Michigan Economic Development Corp. for their hard work and effort to make this opportunity happen for our company in the City of Detroit.”
The company also is committed to hiring qualified Detroiters and those who live in the communities adjacent to the project site by leveraging relationships with Detroit at Work, Detroit Employment Solutions Corporation and Detroit Economic Growth Corporation. Dakkota also offers a tuition reimbursement program to help its employees’ ability to grow and diversify into other industries, and offers formal training opportunities to provide growth within the company.
“Dakkota has made a major commitment to Detroit, bringing its new FCA parts manufacturing plant that will bring more than 400 new jobs to the site of the former Kettering school. Even better, Dakkota founder Andra Rush has committed to interviewing pre-qualified Detroiters for these jobs first, before considering anyone from outside the city and giving highest priority to Detroiters living in the neighborhoods immediately adjacent to the new plant,” said Detroit Mayor Mike Duggan. “I’m optimistic that this development will help attract another supplier to redevelop the rest of the Kettering site and bring even more new jobs to our city.”
In addition to MSF support, the Michigan Department of Transportation has committed $832,939 in grant funding to help address transportation needs. The city of Detroit has matched $268,018 of these dollars to secure the grant funding. Detroit is also providing an Industrial Property Tax Abatement and street/utility vacations. The Detroit Employment Solutions Corporation is supporting the company’s talent needs through its Detroit At Work program. Detroit Public Schools and Detroit Brownfield Redevelopment Authority assisted with the sale and acquisition of the sites.
“The DEGC is committed to creating job opportunities for Detroit residents. Because Detroit was successful in landing FCA’s new Jeep plant, we are now able to attract its Tier 1 and 2 automotive suppliers,” said Detroit Economic Growth Corporation President and CEO Kevin Johnson. “Dakkota will utilize the same preferred-Detroiter hiring process as FCA, ensuring our residents are first in line for quality jobs. Land assembly is a top DEGC priority, so that we will have shovel-ready sites for industrial and light manufacturing investment.”
Other projects approved for MSF funding include the Mosaic Eastern Market Redevelopment Project, which will rehabilitate an existing structure in Detroit’s Eastern Market into a mixed-use food hub. When completed, the project will include accelerator space for food entrepreneurs and food-based businesses, commercial/office space, restaurant space, and a common area with event space. The project is expected to generate a total capital investment of more than $24 million and support an estimated 300 full-time jobs, and will transform an underutilized property into a vibrant entrepreneurial hub in Detroit’s iconic Eastern Market. The City of Detroit Brownfield Redevelopment Authority received MSF approval of local and school tax capture valued at $3.7 million for the alleviation of brownfield conditions at the site. The city of Detroit is also anticipated to approve a 12-year Obsolete Property Rehabilitation Act tax abatement in support of the project.
Relocating or Expanding Your Business In Michigan
Considering Michigan for your company’s relocation or expansion project? Check out Business Facilities’ Michigan Incentives and Workforce Development Guide.