Gongwer News Service
From the NewLab startup hub at Ford’s triumphantly rehabilitated Michigan Central Station, Governor Gretchen Whitmer signed a set of bills into law on Monday, creating a statewide innovation fund and establishing a research and development tax credit.
Whitmer was joined by leaders from Ford Motor Company and NewLab, as well as University of Michigan President Santa Ono and several state lawmakers to celebrate what she described as further measures to make Michigan “a place where you can come and build something great.”
“While there are a lot of Michiganders with big ideas, they have a hard time finding the money just to get started. Think about all of the famous companies that were started in garages or dorms or backyards and grew to be giants,” Whitmer said. “They succeeded because they had access to financing from early-stage investors. Somebody was willing to make a bet on them and help them grow, (during) really the most difficult part of their journey, which is the beginning. If you’re starting something new and have potential to create good paying jobs and to grow our economy, you should be able to access the capital that you need to get going.”
HB 5100 of 2024 and HB 5101 of 2024, sponsored by Rep. Jasper Martus (D-Flushing) and Rep. Julie Rogers (D-Kalamazoo), establish the R&D credit for businesses with 250 or more employees to claim up to $2 million per year and companies with fewer than 250 employees to claim up to $250,000 per year. The credit will also allow taxpayers or employers to claim up to $200,000 in additional credit for expenses if they collaborate with a research university.
HB 5651 of 2024, HB 5652 of 2024 and HB 5653 of 2024, sponsored by Rep. Greg VanWoerkom (R-Norton Shores), Rep. Jason Hoskins (D-Southfield) and Rep. Alabas Farhat (D-Dearborn), respectively, create the Michigan Innovation Fund, which allocates an initial $60 million to be used in providing early-stage capital to startups and entrepreneurs.
Together, Whitmer said the new laws will create a more friendly environment in Michigan for developing businesses.
“The Innovation Fund will invest in Michigan based startups, supporting home grown entrepreneurs and expanding access to the resources that they need to be successful,” Whitmer said. “The R&D tax credit will lower the cost of researching and developing new products for small and big businesses alike and encourage more collaboration with our world class universities.”
Farhat and Martus, the two youngest members of the now adjourned 102nd Legislature, said the bills were designed in part to retain young talent that may have been raised and educated in Michigan, but which frequently leaves the state to pursue entrepreneurial success.
“Republicans and Democrats are coming together to address a very real issue – that Michigan entrepreneurs are leaving our state. They’re leaving it. It’s causing a brain drain,” Farhat said. “It’s causing our best and brightest to start somewhere else. What we’re doing is worth creating an opportunity for our home-grown talent here in Michigan, to employ Michigan, to invest in Michigan, and that first step is starting today.”
Praise for the new programs rolled in from business and university leaders on Monday, including from the Detroit Regional Chamber, the Michigan Economic Development Corporation, Michigan State University, Michigan Manufacturers Association, Invest Detroit and Traverse Connect.
“The Michigan Innovation Fund is a step to attract high-tech entrepreneurs and grow our economy and population – consistent with the Governor’s Grow Michigan Together Council report of 2024,” Detroit Regional Chamber CEO Sandy Baruah said in a statement. “Michigan was built by high flying entrepreneurs, and the Fund will be a valuable tool as we build our next generation of groundbreaking companies.”
Public act numbers had not yet been assigned by the Office of the Great Seal.
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