In Escanaba, $200M for a paper mill, but no new jobs required

One of the first things Michigan’s Democratic-led Legislature did this year was to rush money — hundreds of millions of dollars — into corporate coffers. An appropriations bill of corporate welfare called for sending $946 million from taxpayers to various entities. Escanaba Mill, a paper mill, will receive $200 million.

Senate Bill 7 was passed by a vote of 60-48 in the House and 24-14 in the Senate. Eight Republicans — four in each chamber — joined Democrats to approve the bill. Democrats have a 56-54 majority in the House and a 20-18 majority in the Senate.

Gov. Gretchen Whitmer signed the bill Tuesday.

James Hohman, director of fiscal policy at the Mackinac Center for Public Policy, questions the value of sending money to the paper mill. Michigan already has the SOAR program — the Strategic Outreach and Attraction Reserve — to dole out corporate welfare, he notes. Why not use it?

Lawmakers granted SOAR another $150 million with Senate Bill 7.

The paper company, whose parent company is the Swedish firm Billerud, is not required by the appropriation to create new jobs. The paper mill will, though, have to retain its Oct. 1, 2022, employment level of 1,200 jobs for 10 years.

The company says it will soon pursue a $1 billion investment.

Michigan has shed thousands of paper mill jobs over the past 20 years. In 2001, the industry had over 17,000 jobs in the state. That number dropped to approximately 11,000 in 2011, and moved to over 12,000 as of 2021.

Billerud did not respond to a request for comment.