New TBED Proposals Win Support in Michigan Legislature

August 06, 2008

Last month, Gov. Jennifer Granholm announced legislative approval of two TBED priorities unveiled during her State of the State Address, a program supporting in-state entrepreneurs and continued investment in an initiative to train displaced workers. 

Gov. Granholm announced last week the launch of Invest Michigan!, a statewide initiative that commits $300 million in pension funds to provide capital assistance to start-up and expanding companies. The money will be divided equally between a Growth Capital Fund targeting venture capital and expansion-stage companies and a Michigan Opportunities Fund targeting potential acquisitions and buyouts, according to the governor’s press office. Investments of $2 million to $7 million are anticipated for the Growth Capital Fund, while officials expect to make about 10 investments ranging from $25 million to $125 million in the Michigan Opportunities Fund, the Detroit Free Press reports. To grow the size of the fund, the state will encourage additional institutional investors, such as in-state foundations, universities and the business community.
 
Gov. Granholm unveiled a new component of the program for the upcoming year and outlined the progress of the No Worker Left Behind Initiative, which celebrated its first anniversary last month. Lawmakers approved $15 million in fiscal year 2009 for the initiative ($25 million less than the governor’s recommendation), augmenting an existing pool of dedicated federal funds for worker training initiatives. A new green jobs component will direct $6 million for investment in job training within emerging industries of wind, solar, biofuels and geothermal. The program provides financial assistance for training programs or up to two years’ tuition at any Michigan community college or university for training in high-demand occupations. Since its inception last year, 31,000 participants have enrolled in the program and 11,000 have completed training, according to the governor’s office.
 
The state’s 15 universities will receive an across-the-board increase of 1 percent for operating expenses in FY09. Legislators rejected the governor’s proposed 3 percent increase based on an incentive formula rewarding universities for returns on research and technology commercialization (see the Feb. 13, 2008 issue of the Digest). The slight increase is, however, the first raise in the higher education budget in seven years, according to a Detroit News article. Michigan community colleges will receive a 2.1 percent increase in operating expenses and the Michigan Agricultural Experiment Station (MAES) budget will increase by 1 percent for a total of $34.3 million in FY09. The governor recommended a 3 percent increase for MAES, which encompasses the work of more than 300 scientists in five colleges at Michigan State University.
 
The FY09 enacted budget includes $65 million under the Michigan Strategic Fund for the 21st Century Jobs Fund and $1.25 million for the business incubator program.
 
The FY09 general government appropriations act is available at: http://www.legislature.mi.gov/documents/2007-2008/billenrolled/House/pdf/2008-HNB-5816.pdf

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