LANSING, Mich. – Lawmakers on Wednesday authorized a $666 million transfer of state funds to finalize incentives for General Motors to locate an electric vehicle plant and an electric vehicle battery factory in Michigan.
The deal was approved by the state's economic development board in January but still needed the blessing of legislators, who had signaled their support earlier by putting $1 billion into the new Strategic Outreach and Attraction Reserve Fund as part of legislation signed by Gov. Gretchen Whitmer.
The Senate Appropriations Committee voted 14-4 to shift $666 million from the account to new “critical industry” and site readiness funds. The House Appropriations Committee approved the step 18-9.
GM, headquartered in Detroit, plans to spend up to $4 billion converting and expanding its Orion Township assembly plant to make electric pickups and $1.5 billion to $2.5 billion building a third U.S. battery cell factory with a joint-venture partner in Lansing. The moves are expected to create up to 4,000 jobs and keep another 1,000 already employed at the Orion facility.
GM and Ultium Cells, the venture between the automaker and LG Energy Solution, will get $600 million from the state. A local electric utility and township will receive $66 million to upgrade infrastructure at the battery plant site.
“We took a very important step today in securing funds to continue electrifying our economy," Rep. Joe Tate of Detroit, the top Democrat on the Republican-controlled House budget panel, said in a statement. "By investing in critical EV developments, we can ensure Michigan stays at the forefront of mobility and electrification while providing more opportunities for Michigan families to get ahead.”
The incentives package has come under criticism, including from lawmakers.
Sen. Jon Bumstead, a Newaygo Republican who sits on the Senate budget panel, called it “corporate welfare.”
“I understand the intent is to keep Michigan competitive by retaining one of our state’s largest companies from one of our most important industries,” he said. “But it is hard to justify giving away hundreds of millions in state taxpayer dollars to one company, especially when you consider all the jobs and businesses that were lost over the past two years from the state’s response to COVID-19.”
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