Taxpayers To Fund $719,528 Dealership Renovation in Michigan

George Matick Chevrolet in Redford Charter Township, Michigan is raising eyebrows after being approved on August 26th for $719,528 dollars in renovations to be paid for by the government. Specifically, the money is coming from the Michigan Strategic Fund. According to the Michigan Economic Development Fund website, the organization is “the state’s marketing arm and lead advocate for business development, talent and jobs, tourism, film, and digital media incentives, arts and cultural grants, and overall economic growth.” The question that some are posing is how this arm of the State of Michigan is able to fund the remodeling of a car dealership?

The Michigan Economic Development Corporation (who is over the Michigan Economic Development Fund) claims that this move is appropriate. According to a report from mlive.com, the MEDC explained the renovation of the dealership when they said that, “The building’s age, excessive size, high operational costs, increasing costs of regulatory compliance and maintenance, and current automotive customer expectations have rendered it unsuitable for long-term continued use.” Another term used was that these renovations will help George Matick Chevrolet “stay afloat.”

The money is being taken from local and school taxes. On that subject, Michael Lafaivre, a director with a free-market advocacy group spoke out in opposition of the taxpayer-funded renovation. Lafaivre explained that, “It is unfair because this dealer no doubt competes with other dealers not lucky enough to get a government handout; robbing many taxpayer Peters to subsidize the corporate Paul only shifts precious resources around. Evidence shows it is unlikely to create net new jobs. Worse, this is money that could have accrued to local schools.”

The Michigan Strategic Development Board voted unanimously in favor of construction. When questioned, board members sounded downright conflicted about the decision. Board member Jim Walsh said that, “There are other competitors (dealerships) in the area and effectively we are helping to make it more difficult to them. “ Another board member was quoted as saying, “It’s a close call but I want to make sure people know I don’t think we should be in the business of financing dealerships or the construction thereof.” However, in this case, they did just that.

Stacy Esbrook with MEDC explained some of the reasoning behind why this dealership is being renovated with taxpayer dollars. Esbrook said that, “The community does not want to have a large vacant parcel if the dealership closes.” The President of the MEDC, Mike Finney, is content with the final decision. Finney said that, “We evaluate every project on a project by project basis. In this case because of some of the public infrastructure needs that were there, it made sense for the MEDC staff to recommend it and the board appropriately approved it. Finney also noted that he couldn’t remember the board ever having “approved incentives” for auto dealers in the past but that the public infrastructure needed their help.

The comment section of the mlive website showed dissatisfaction with the decision to renovate the dealership. One man explained that he is struggling to get by and pay the bills and isn’t happy to see his tax dollars going toward a private business. What do you think? Should this dealership get the money for renovations from taxpayer dollars?