Warren Mayor Tempts GM With Tax Abatements
Jim Fouts, the mayor of Warren, Michigan, has made GM an offer he hopes it can’t refuse. According to the DetN, Fouts hand-delivered a proposal to GM’s Renaissance Center that offered the automaker a 30-year tax abatement on personal property taxes if it moved headquarters to its Warren Technical Center. The offer, which Fouts calls “unprecedented,” would give GM 100 percent off taxes on all machinery and equipment and 50 percent off the taxes associated with any new construction for a period of 12 years.
“I present this to you not as a choice between Detroit and Warren, but as a matter of GM moving forward and surviving,” Fouts’ letter states. “Restructuring implies cost-cutting, and this proposal is a prime example of cutting costs through consolidation.” But Fouts is known for helping the auto industry when it helps him. He admitted, for example, that his recent “buy American” effort was more about keeping his cronies employed than anything else. Meanwhile, the Freep is wringing its hands ( twice!), calling the proposal a potential coup de gras for Detroit after decades of urban flight. Not since the later stages of the Donner party have we seen such a hotly-contested corpse.
More by Edward Niedermeyer
Comments
Join the conversation
derm81, you are the real deal in terms of knowing accurate information. I, for one, appreciate your comments and the education very much. What are the odds GM moves its HQ to the Warren Technical Center once it has the cover of bankruptcy, which will shelter such a decision from politics (much more so than sans bankruptcy)?
I have heard that it's pretty damn good chance unless Detroit mayor Dave Bing puts together some sort of "zone" incentive package. The GM Tech Center is perfect for an HQ. Look at Chrysler having everything under one roof rather than having to drive up 75 to 696 and up Van Dyke every time you have to get something real done. If you havent been in the area or arent familiar with it....the Tech Center isnt one building. It's a campus with a great many buldings. A lot of financial "stuff" is done in the new blue addtion that was added on the east side of the TC. Plus Detroit city income tax is something like 1.5% for non-residents.
Derm - I agree. I think that the bankruptcy filing will insulate GM's brass from any criticism if they decide to make that move (and it may be decided by the government auto czar), and that it's clearly in GM's and their employees best interests to do so, for financial, employee morale and consolidation & efficiency of operation reasons. I think that the bankruptcy filing will insulate GM’s brass from any criticism if they decide to make that move (and it may be decided by the government auto czar), and that it’s clearly in GM’s and their employees best interests to do so, for financial, employee morale and consolidation & efficiency of operation reasons. Moving to the newly revamped and technologically advanced (if you don't believe how advanced, you've obviously never been on site) Warren Technical Center would be the smartest business move, by far, for GM. The Warren Technical Center is the 'Command & Control' center where all global platforms for GM cars are developed by the most advanced engineers and designers working for the company, whether the chassis is being produced in Lansing, Seoul, Shanghai, Mumbai, Mexico City, Rüsselsheim, or San Paulo. Moving the white collar execs from their glass house in the RenCen to the Warren Technical Center would only improve communication and efficiency, and deconstruct the walls and barriers that impede and have impeded GM's operations for so long. This decision should be made based on sound, rational business judgment, and not politics of race or region. Let's face it, another compelling reason is that Detroit is dreadful in delivering city services efficiently, has one of the most onerous and burdensome tax structures for corporations and employees in the entire nation, and is a place where the companies and countries that GM deals with are literally afraid (rightfully or not) to send their employees to.
i would like Jimbo to make a list. a list comprising of 30 things that i use in my day to day life that are made in the US. if he can't finish the list, he should eat that bumper sticker.