Economic Development Job Training Grants

According to annual appropriations bills, "The purpose of this program is to develop a specific skill, for Michigan residents identified for a particular Michigan business that assists that company to compete in the global economy and to create or retain high-paying jobs for Michigan residents."[55] The program has existed since 1992[56] and is administered by the MEDC. The state works with educational organizations — mostly community colleges — to train the workers of select firms.

Companies can receive direct grants, too. To be eligible, a company has to create or retain 100 jobs at a single Michigan site within two years of the grant,[*],[57] meaning that small businesses would not be eligible. This grant is occasionally used in conjunction with MEGA tax credits, which also tend to involve larger projects. While specific reporting on this is unavailable, counts from documents received from the MEDC indicate that more than $57 million in EDJT grants have been pledged in MEGA deals.[58]

Last year, only one company, IBM, received direct support. The company was awarded a $500,000 grant to train 100 new employees.[59]

Companies must bear 30 to 50 percent of the costs of training existing workers, although new employees can be fully supported by the grant.[60] Workers cannot be charged for tuition.[61]

There are limited funds available every year, and recipients are prioritized based on MEDC criteria, but the organization has statutory authority to make decisions based on the need for training and the number and wages of the expected new jobs.[62] Additional restrictions in the appropriations bills prevent the grants from being used to train "permanent striker replacement workers" and prohibit worker training programs from charging excessive administrative costs.[63]

Last year, the MEDC made 43 EDJT grants, which pledged more than $5.6 million to train 7,303 employees.[64] All but 13 grants went directly to community colleges.

The program has been significantly scaled back since 2000. Initial appropriations in fiscal 2009 were $7.3 million, down from $31 million in fiscal 2000.[65] All of this money comes from Michigan's general fund, which is largely composed of income, business and sales taxes.

[*] Thresholds go down to 50 employees if the grant is expected to be $20,000 or less.

[55] "Public Act 261 of 2008," Sec. 1002(1).

[56] "Performance Audit of Selected Training Related Programs: Michigan Economic Development Corporation,"  (Michigan Office of the Auditor General, 2003), 7.

[57] "Public Act 261 of 2008," Sec. 1002(4).

[58] Total derived from "MEGA Transparency Project" documents available at

[59] "Economic Development Job Training Grants," in Michigan Economic Development Corporation Annual Report to the Legislature (Michigan Economic Development Corp., 2008).

[60] "Public Act 261 of 2008," Sec. 1002(10).

[61] Ibid., Sec. 1002(9).

[62] Ibid., Sec. 1002(7).

[63] Ibid., Sec. 1002(2) and (3).

[64] "Economic Development Job Training Grants."

[65] "Public Act 120 of 1999," (Michigan Legislature, 1999), 4, (accessed August 27, 2009) and "Public Act 261 of 2008," 15.