For Immediate Release
Monday, Aug. 2, 2010
Contact: Michael D. LaFaive
Director of Fiscal Policy
Michael D. Jahr
Senior Director of Communications
MIDLAND — Reacting to a criminal charge announced today in connection with a proposed Grand Rapids-area film studio, Mackinac Center Fiscal Policy Director Michael D. LaFaive called for greater transparency in the state’s tax subsidy process.
“Taxpayers won’t have to pay for this dubious tax credit,” said LaFaive of the felony charge filed today against Joseph Peters, lead investor in the Hangar42 project. “But how many other problems have gone undetected because of the wall of government secrecy that surrounds the Michigan Economic Development Corp. and the state’s entire tax credit regime?”
The Mackinac Center broke the story of Hangar42 following a months-long investigation by Center analysts, including a call for the Michigan Attorney General to investigate the deal. LaFaive and Communications Specialist Kathy Hoekstra raised several questions about the matter with an essay and investigative video posted May 20. At issue was the value of the proposed film studio, which those involved said was worth $40 million, even though it had been listed by a real estate agent for $10 million shortly before the deal was announced.
LaFaive also cited the events of March 2010, when a convicted felon who had been approved for business tax credits through the Michigan Economic Growth Authority shared the stage with Gov. Jennifer Granholm. The credits were later revoked.
“Clearly this process lacks sufficient controls,” LaFaive added. “We have called for more transparency for years to help prevent this alleged activity.”
LaFaive noted that the mere filing of a criminal charge does not imply guilt.
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