State Rep.: 'The MEDC's track record in picking winners is poor'
Promoting corporate welfare can be lucrative.
There are now 52 employees of the Michigan Economic Development Corp. with annual salaries of $100,000 or more.
That is a roughly 60 percent increase over the 31 MEDC employees that topped $100,000 in 2010, the last year Jennifer Granholm was governor.
The Michigan Information and Research Service, a Lansing political newsletter, reported the new MEDC salary numbers, which it said it obtained from the MEDC. In its article, MIRS made a distinction between the 12 "public" MEDC employees who made $100,000 or more and the 40 "corporate" employees who made $100,000 or more. Corporate employees at the MEDC are primarily paid from Indian gaming revenues, which are not subject to legislative appropriation. The MEDC has 335 employees.
MIRS also reported that the annual salary of MEDC president and CEO Michael Finney was $257,500.36. In 2012, Finney was the top-paid state government official, but in 2013 Jon Braeutigam, a deputy treasurer and chief investment officer became the most handsomely reimbursed with a $333,300 salary, according to MIRS.
"The MEDC should be focused on creating private sector jobs not inflating public sector salaries," said House Democratic Leader Tim Greimel, D-Auburn Hills.
House Democrats have been critical of the MEDC under Gov. Rick Snyder, saying the agency has not been transparent regarding the true performance of its projects — a position the Mackinac Center for Public Policy has held for a number of years.
Officials from the MEDC declined to comment.
Rep. Greg MacMaster, R-Kewadin, and Rep. Wayne Schmidt, R-Traverse City, who are running to replace Sen. Howard Walker, R-Traverse City in the 37th State Senate district, had different reactions to the news that 52 MEDC employees make $100,000 or more.
"I'm concerned that the MEDC at times skews the playing field by picking winners and losers, taking resources in the form of taxes from some corporations, including Indian gaming, and then giving them to other businesses," Rep. McMaster said. "In this way, businesses succeed or fail not because of the inherent quality of their goods and services, but due to their ability to successfully lobby elected officials and bureaucrats. That’s not free enterprise.
"[The] MEDC's track record in picking winners is poor, with underperformance of job creation the norm. I would like to see this improve," Rep. MacMaster continued. "But the final insult is that taxpayers fund the MEDC to the tune of $200 million a year, including multiple $100,000-plus jobs for officials, and $257,500 for last year’s highest paid employee in state government. Did the MEDC achieve the desired benchmarks to warrant the salary increase they received? I haven't seen anything to support it."
Rep. Schmidt said the MEDC is needed for Michigan to successfully compete for jobs and that the agency's salaries do not appear to be out of line.
"When looking at the MEDC you need to realize that we are competing against, not only other states, but other countries," Rep. Schmidt said. "No other state has disarmed and no other country has disarmed. States that we complete with, such as Texas, Alabama and the others, have agencies that are their equivalent to our MEDC. In just the automotive sector alone, we’re talking about 500,000 jobs that we’re competing for. I’m not willing to lose those jobs to other states, and especially not to other countries.
"When I was the chair of the [House] Commerce Committee we constantly worked to make sure that MEDC remained lean and efficient," Rep. Schmidt continued. "Most of the MEDC employees [the corporate ones] are not paid through general fund dollars that come from the taxpayers. They are paid from funds that come from tobacco fund dollars or Indian gaming dollars. If you look at what they are paid and make a comparison, you’ll find that it is consistent with what employees of the same sort agencies in other states are paid."