The assignment is to somehow convince the major car manufacturers and others that they should help the boss find a way to reduce the state tax credit liability. The governor stopped the give-away in 2011 but is still stuck with the credits awarded by the Granholm administration. They were dished out just after GM and Chrysler came out of bankruptcy and as former Granholm budget guy Bob Emerson reflects, it was her way of helping them get back on their feet.
But now the "help" has turned into a monster revenue drain on the Snyder coffers, creating a $550 million hole in his budget and it will get worse if not put in check. This governor does not like holes in the budget .
It's analogous to you giving a big gift to one of your favorite relatives and then realizing after the fact, you could not afford it. It's the asking for the money back that is the dicey part.
Democrats for sure want the governor to do something because they want the money back for schools and other programs they like.
"I think the governor needs to demand they come back to the table," demanded Rep. Brandon Dillon (D-West Michigan). He concedes he wants the autos and others to create jobs, but the tax credit costs need to be brought back in line.
The governor vaguely referenced all this in his budget presentation last week as lawmakers were left to figure out on their own what the governor's strategy was. There could be "talks," he hinted.
Pressed by the media the governor coughed up a few details first saying it was "premature" to say there were real discussions but he did confess the companies that are claiming the tax credits "are open to discussing" this and there were "reasonable topics that could be discussed."
Translated that could mean some sort of cap on tax credits that run for years to come. Or sort of a reverse stock buy back where by the state would buy back some of the tax credits.
Team Snyder/Baird will concoct something because they know the longer the credits sit out there, the bigger the drain on state revenue and the more pressure there will be to cut state services to make up the difference.
And everybody knows lawmakers would rather spend than cut. The question is while the autos and others play ball to allow them to do just that?