Snyder urges Michigan House to OK incentives for Foxconn

By DAVID EGGERTEconomic IndicatorsAssociated Press

Gov. Rick Snyder urged the Republican-led Michigan House on Friday to pass economic development tax incentives when it meets in July, saying there is still time to lure a Taiwanese electronics giant to the state despite the cancellation of a vote on the legislation.

Foxconn, which plans to locate a display panel factory in the U.S. that could cost up to $7 billion, will announce investment plans by early August for at least three states, Chairman Terry Gou said Thursday. He mentioned Michigan, Ohio, Pennsylvania, Illinois, Wisconsin, Indiana and Texas as manufacturing states with which Foxconn hopes to work.

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House Speaker Tom Leonard called off a vote on the Senate-approved bills Tuesday night and adjourned until July 12, citing concerns that the Republican governor had cut a deal with House Democrats that would "undermine" other GOP priorities. He did not elaborate.

Snyder, who is on a weeklong trade trip in Europe, told The Associated Press that the proposed tax incentives for large-scale business expansions are "relatively straightforward" and are about "more and better jobs for Michigan." He traveled to Japan in early June to entice Foxconn, which assembles smartphones and other devices for Apple, Sony, Blackberry and other brands — mostly in China.

Asked about Foxconn's decision-making process, Snyder said in a phone interview from Milan, Italy: "We're later in that timeframe but there still is time. ... If we get something done in July, we can still hit that (August) date."

After Snyder took office, Michigan in 2012 stopped issuing new tax credits for companies to add or retain jobs as part of an overhaul that slashed business taxes overall. The state instead awards a smaller pot of cash grants and loans for economic development.

Snyder, senators and economic development officials now say tax incentives should be offered again to help Michigan compete with other states for major projects, but some GOP lawmakers — including the House speaker — are opposed philosophically.

Snyder said he wants to hear Leonard's specific concerns about the negotiations "first person." He did not say if the administration had agreed to scuttle future GOP labor-relations bills in exchange for support from Democrats already upset about a plan to coax newly hired teachers into a 401(k)-only retirement benefit.

The tax incentives, valued at up to $200 million a year for companies adding at least 250 jobs, cleared a House committee Tuesday after six of eight Republicans and three of four Democrats voted yes.

"As a practical matter, you have a situation where a bill's going through the Legislature," Snyder said. "Doesn't it make sense that I should be talking to Republicans and Democrats and trying to work together on getting something done? I thought that's how the legislative process should work. I'm not focused on partisanship. I'm focused on getting good jobs for Michiganders."

But Leonard spokesman Gideon D'Assandro said there is "a lot of confusion" over what agreement may have been cut with Democrats.

"If a deal takes good bills and Republican priorities off the table, then it could be bad policy. ... That is why House Republicans need to get those answers from the governor," he said.

A GOP legislative official and a Snyder administration official, speaking on the condition of anonymity because they were not authorized to discuss private meetings, said the agreement included Snyder publicly saying that he saw no need for more labor-relations bills. Exceptions would be made for changes to municipal retiree health care benefits and state civil service rules in his final 18 months in office.

Snyder signed right-to-work laws in 2012. He has opposed, however, GOP bills to repeal a state law that ensures union-level pay on state-financed construction projects after Democrats helped to propose a 2015 ballot initiative to raise taxes for road repairs.


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