This originally appeared in the Midland Daily News on April 12, 2001 at http://midlandmi.hearstnp.com/SelectStory/story_id=3775.

DETROIT (AP) - The Michigan Economic Development Corp. wants to help the state shed its image as strictly a manufacturing hub and attract attention to its growing technology centers.

To that end is the creation of nearly a dozen SmartZones, clusters of high-tech businesses, research institutions and training facilities throughout Michigan that are being marketed to lure outstate investment with tax incentives and other assistance.

``We felt Michigan needed to do something dramatic to showcase the talent we have,'' said Doug Rothwell, president and CEO of the economic development corp. ``There's no Silicon Valley in Michigan where you can go to an area with a cluster of high-tech companies. We want to recreate that in Michigan but make it statewide.''

The SmartZones were announced Wednesday and will be housed in Battle Creek, Lansing, Mount Pleasant, Kalamazoo, Grand Rapids, Muskegon, Houghton, Ann Arbor-Ypsilanti and three Detroit-area locations. Each area aims to build on its specific strengths, such as aviation and aerospace research in Battle Creek and information technology advances in Ann Arbor and Ypsilanti.

SmartZones located in cities may use property and school taxes for up to 15 years to purchase property and build infrastructure and research parks.

Additionally, SmartZones in cities are eligible to tap into the Core Community Fund, a $50 million pot set aside by the state Legislature to help businesses get started.

Areas such as Oakland County's Automation Alley - a collaboration of technology companies - get the SmartZone designation but aren't eligible for the tax incentive because they are spread throughout the county rather than centered in a downtown. But it will get the benefit of MEDC marketing efforts.

Rothwell expects some SmartZones to begin construction by this summer.

But the state's efforts to draw and promote businesses aren't receiving praise from everyone.

The Mackinac Center for Public Policy, a research and education organization, thinks the state dollars could be more wisely used on roads, schools or other projects to benefit all residents, according to policy analyst Mike LaFaive.

``This is the state picking regions to bestow advantages on at the expense of other regions,'' LaFaive said. ``The entire state should be a SmartZone, not just 11 lucky regions.''

LaFaive said studies have shown that such targeted investment results in businesses losing out to other businesses in the designated areas.

``This isn't job creation, this is job shifting,'' he said.

An advantage of the SmartZone designation is the marketing assistance each area will receive from the MEDC, Rothwell said. The corporation is promoting the SmartZones in areas such as Chicago, Indianapolis and Cincinnati in hopes of attracting new businesses to Michigan.

``We expect in the next five to 10 years to see a significant number of start-up companies,'' Rothwell said. ``Each community has its own speculations on how many jobs will be created by the SmartZones.''

Share More …