Testimony on House Bills 5104 - 5107 — Mackinac Center for Public Policy

Summary

Testimony on House Bills 5104 - 5107 from James Hohman, Director of Fiscal Policy, Mackinac Center for Public Policy. The testimony says Michigan already operates a program whose only limit is what is appropriated, and that the bills extend that structure to local governments and other entities. It argues that subsidy policies ought to have clear economic or fiscal goals etched into statute and that legislators should establish clear criteria about what projects can receive state funding and how much. It states that the bills propose a list of nonexclusive criteria and create a minimum amount of funding rather than a maximum.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

Testimony on House Bills 5104 - 5107

Michigan already operates a program that allows administrators to give whatever business they want
much they want to give, with the only limit being what is appropriated and what appropriations committee
members agree to allow. This is an inappropriate way to operate state economic development policy.

These bills further extend that unlimited structure, allowing for local governments and other entities to
receive similar support from the state.

Subsidy policies ought to have clear economic or fiscal goals associated with them and etched into statute
to ensure that supporters may be held accountable for the state’s subsequent economic performance. This
bill does not have state economic performance requirements. It continues the state’s history of adding
economic development programs that are not required to grow the economy.

Even without accountability linked to the state’s actual economic performance, legislators should establish
clear criteria about what projects can receive state funding and how much projects may receive. The
bills propose a list of nonexclusive criteria that can be fulfilled with stated intent rather than project
requirements. To the extent that the bills establish state funding guidelines, it creates a minimum amount
of funding rather than a maximum. Administrators should have some discretion, but only within bounds
clearly established by the legislature. Those do not appear in the bills.

Economic development legislation should be required to grow the economy. New programs ought to
have clear expectations and outcomes. Programs to award economic assistance ought to subject to clear
cost-benefit analyses by independent reviewers that weigh programs against alternative applications of
state funding, such as greater infrastructure spending or across-the-board tax cuts. Legislators should
be working to establish more functional selective assistance rather than extending programs that lack
these features.




                                           James Hohman
                                      Director of Fiscal Policy
                                Mackinac Center for Public Policy
                                             mackinac.org


File and source

File

2023-10-24_testimony_hecon-2023-mackinac-center-for-public-policy_39316.pdf

Size

70,028 bytes

SHA-256

bac89625e611b6e3c83e7ffd09216cd72e51a553c9c777b44035bfa7d06e0e41

Our copy

2023-10-24_testimony_hecon-2023-mackinac-center-for-public-policy_39316.pdf

Original

No public link identified.