Both sides of the aisle are expressing concerns over Michigan Gov. Gretchen Whitmer’s $250 million overhaul of the Strategic Outreach and Attraction Reserve Fund.
First created in 2021 as a reaction to Ford Motor Co. moving major manufacturing to Kentucky and Tennessee, the fund has since doled out $1.7 billion to Ford and General Motors in an attempt to keep the companies away from “right to work” states.
Senate Community and Economic Development Committee Chairwoman Mallory McMorrow, (D-Royal Oak), described the SOAR fund as reactionary in a March floor speech.
“And I think sometimes we have to take hard lessons in acknowledging that sometimes even with the best intentions, things may not turn out the way that we wish,” McMorrow said.
Michigan Republicans, such as Rep. Donni Steele (R-Orion Township), have criticized SOAR spending as corporate welfare.
“SOAR is broken, and House Democrats plan to fix it by moving some money around to create similarly flawed programs with even more specific carve outs,” Steele said.
“If we’re going to offer corporate incentives, we need to ensure that every Michigan company has an equal shot for assistance. Nothing in this plan addresses that clear lack of fairness, oversight, and accountability.”
Failed projections in the electric car industry have worsened the problem.
While the SOAR fund gave $1 billion to Ford, alongside other tax incentives, the company has had to cut 800 jobs from the projected 2,500 at its Marshall battery plant.
GM was awarded $600 million from SOAR to build an electric truck plant, but production has been delayed until late 2025.
“It feels like every day we hear about another taxpayer-funded project that will be smaller and yield fewer new jobs than was initially promised,” Steele said.
“Yet, instead of looking inward to see how we as leaders can better spend taxpayer dollars, Gov. Gretchen Whitmer and Lansing Democrats find new ways to throw money at a wall to see what sticks.”
Democrats like McMorrow argue Whitmer’s 2024 rebranding of SOAR to the Make it in Michigan Fund could solve the problem. Its centerpiece, the Michigan 360 program, would take $250 million of SOAR funding and use it toward community investments.
House Minority Leader Matt Hall, R-Richland Township, argue more extensive change should be undertaken, such as restoring right-to-work protections against mandatory union membership, and cutting taxes and regulations.
“I want to see things that address clawing back money if they lay off people,” Hall said.
“I want to put things in there that address the fact that we should have small and medium businesses benefit from this too, not just big companies.”
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