Senate bill would increase taxpayer-funded brownfield incentives

Private companies could get even more taxpayer money for redevelopment programs if lawmakers approve new legislation to expand a tax credit program.

Senate Bill 723, introduced Dec. 3 by Sen. Sarah Anthony, D-Lansing, aims to expand the Brownfield Development Program, which gives tax credits to companies that redevelop existing developments (“brownfields”) through a mechanism known as “tax capture.” Under tax capture, developers can collect and keep for themselves revenue from income and sales taxes that would otherwise go to the government.

The annual limit for the program would increase from $80 million to $175 million under the legislation, and the total amount allowed for its duration would increase from $1.6 billion to $3.5 billion. While authorization for the tax credit is set to expire at the end of 2027, Carter’s bill would extend the sunset date to Dec. 31, 2029.

An expert in economic development told Michigan Capitol Confidential that these programs tend to show poor results.

“Too often, both legislators and lobbyists believe that the demand for a program that hands out money is proof that the program works” said James Hohman, fiscal policy director at the Mackinac Center for Public Policy.

Before legislators double the amount of taxpayer funds spent on the program, Hohman said, they should ask whether it works as intended.

State officials have resisted outside efforts to make public details about the benefits the tax credits they have extended so far.

The Mackinac Center filed a lawsuit in July against the Michigan Department of Treasury on behalf of the Detroit Free Press after the department stonewalled a Freedom of Information Act request. The Free Press and Mackinac Center are trying to find out how much the state has paid to companies through the tax credit program.

The request was for a development – One Campus Martius expansion – managed by Bedrock. Bedroock, according to Crain’s Detroit Business hopes to capitalize on Anthony’s legislation and benefit from tax captures for the Renaissance Center redevelopment site.

“J.C. Reindl, Detroit Free Press reporter, submitted a Freedom of Information Act request on March 17, 2025, seeking state-generated financial documents detailing how much tax revenue is being reimbursed and whether the site is meeting job and investment targets,” the Mackinac Center Legal Foundation writes. ”The Michigan Department of Treasury denied the request, citing a state law protecting taxpayer information. The Mackinac Center argues that these are not private filings but government-generated financial reports — and that the Michigan Constitution requires disclosure of any records involving public funds.”

Bedrock gained approval last month for $75 million in taxpayer funds through the Detroit Downtown Development Authority, the Michigan Chronicle reported.

Key legislative leaders have criticized Bedrock’s $250 million request for taxpayer funds.

The Michigan House is considering similar legislation.

House Bill 5101, introduced in October by Rep. Joseph Aragona, R-Clinton Township, also would amend the law. Like Carter’s legislation, Aragaon’s bill would increase the annual limit from $80 million to $175 million.

Aragona did not respond to a request for comment.