(The Center Square) – Michigan taxpayers will give $325,000 to a private manufacturer in exchange for 50 promised jobs in the Upper Peninsula.
Gov. Gretchen Whitmer joined the Michigan Economic Development Corporation to announce that manufacturer LP Building Solutions will spend $194 million expanding its operations in Sagola Township.
“This transformational investment by LP Building Solutions – one of the largest ever supported by Michigan’s economic development fund in the U.P. – will create at least 50 good-paying manufacturing jobs in Sagola Township and underscores the strength of our talented manufacturing workforce and the attractiveness of our business climate,” Whitmer said in a statement. “Together, we will continue growing Michigan’s economy by empowering our hardworking people and innovative businesses.”
The Nashville, Tenn., based company claims it will create at least 50 jobs at the site, supported by a $325,000 Michigan Business Development Program performance-based grant. LP Building Solutions currently employs 151 people in Dickinson County, where it has operated since 1988.
The expansion will include 134,000 square feet of new construction, machinery, and equipment to create engineered wood home siding products.
James Hohman, director of fiscal policy at the Mackinac Center, questioned why taxpayers footed the bill for a private business expansion.
“It’s great when companies expand their operations in Michigan,” Hohman said in a statement. “I wish lawmakers wouldn’t feel like it’s necessary to hand out taxpayer cash to them when they do. It’s unlikely to have changed whether they locate in Michigan, it’s money that could be spent elsewhere or left with taxpayers, and it’s unfair to competitors who don’t get special favors.”
Quentin Messer, Jr., CEO of the MEDC and president and chairman of the Michigan Strategic Fund, welcomed the news.
“This project is an exciting win for the Upper Peninsula and further demonstrates Team Michigan’s commitment to supporting economic opportunities throughout all regions of the state,” Messer said in a statement. “We appreciate LP Building Solutions’ vote of confidence in Michigan and our talented workforce.”
Sagola Township anticipates giving the project a property tax reduction, and the MEDC also authorized a State Education Tax reduction.
“Customer demand for LP SmartSide Trim and Siding is at an all-time high,” said Jason Ringblom in a statement. He’s the company’s executive vice president and general manager of siding. “To ensure our customers have the product they need to build beautiful, durable homes and structures, capacity expansion projects like our conversion of LP Sagola to the manufacture of LP SmartSide are incredibly important to LP. In addition to supplying the increased demand for SmartSide, converting LP Sagola to a siding facility positions the mill for years of growth and improved stability, which will benefit our local employees, their families, and the broader community.”
Dickinson Area Economic Development Alliance Executive Director Lois Ellis welcomed the “significant investment.”
“The project will align the plant to produce a high-value product and provide 50 additional family-sustaining jobs with excellent wages and benefits for area residents,” Ellis said in a statement.