State Business Handout Program Wastes Another $2 million [Mackinac Center]

State Business Handout Program Wastes Another $2 million [Mackinac Center]
"Another state subsidy deal fails to deliver--Posted by Michael D. LaFaive
The state’s Michigan Business Development Program, a creation of the Gov. Rick Snyder administration, was meant to replace the demonstrably failed Michigan Economic Growth Authority program and — presumably — have more success at creating jobs.
The Legislature should shut down the MBDP in its entirety, but short of that, cut the program’s annual budget at least by the amount of taxpayer dollars it loses to bad decisions.
One such bad choice involved RNFL Acquisition LLC, which was located in Marquette County in the Upper Peninsula.
This firm did business as “Michigan Renewable Carbon” and was a subsidiary of Biogenic Reagents. It was given $2 million in state subsidies through the MBDP and a “Renaissance Zone” designation, which exempted it from real and personal property taxes.
State officials did this for a firm that they knew was “in a pre-revenue stage” and that, without the subsidy, the “project could be at risk.”
The state subsidy deal required RNFL to create 27 new jobs and comply with “revenue participation” terms, which mandated it to pay back to the state 112 percent of the subsidy
...But it was not to be.
RNFL Acquisition laid off its employees in June 2016...
...The MEDC’s spokeswoman, Michelle Grinnell, said, via email, “We have not received any repayment, and at this point don’t expect that we will.
The asset sale was not sufficient to cover all of the creditors, including MSF.”
Despite this failure, the company deal still appeared on an MEDC webpage as late as June 7, 2018, under the heading “Pure Michigan’s Business Success Stories.” 
In summary, state taxpayers ponied up $2 million in job creation subsidies that didn’t create any jobs."
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