News Story

Wind Power 'Success Story' Was a Massive Failure

Wind project still cited years after it failed to materialize

A few years ago, Vice President Joe Biden called a wind turbine facility in Saginaw one of the top "100 Recovery Act Projects that are Changing America."

In 2010, the American Recovery and Reinvestment Act awarded Merrill Technologies Group a $22 million advanced energy manufacturing tax credit that then-Gov. Jennifer Granholm's office said was used to buy advanced manufacturing equipment needed to create wind turbine components in a facility in Saginaw. The Recovery Act also gave Merrill Technologies another $3 million.

The former governor trumpeted the facility as the future of Michigan's economy that would help create 89,918 clean energy jobs.

The facility produced one wind turbine that triggered news reports around the country.

And then?

The facility "never got started," said Michael Shore, spokesman for the Michigan Economic Development Corp., in an email he sent in May in response to questions about the project.

Yet, that hasn't stopped wind power advocates around the country from touting the project as a success.

The American Wind Energy Association, a national trade association based in Washington, D.C., still cited the Saginaw facility in its 2014 update on wind manufacturing in the state. 

Saginaw Future Inc., which is a public-private alliance that includes the city of Saginaw and 15 local municipalities, cited the wind turbine facility on its website, stating that the expectation is the facility "will become a major supplier for Michigan-made wind turbines … "

Andrea Fisher, a spokeswoman for Merrill Technologies, said the company was eligible for, but did not receive, the $22 million advanced energy manufacturing tax credit from the Recovery Act.

Merrill did receive $3 million from the Recovery Act, which the company matched with its own $3 million. That equipment is not being used for building parts for wind turbines but is being used for other manufacturing purposes, Fisher said.

In a presentation in May at the World Energy Innovation Forum, former Gov. Granholm included the Saginaw facility project as contributing to the inaccurate 89,000 clean energy jobs in Michigan figure.

"It does not surprise me that wind power proponents point to this as a 'success story,' " said James Taylor, senior fellow for environmental policy with the Heartland Institute. "The reason being is wind subsidies across the board have been wasteful boondoggles that produce little wind power, fewer jobs, but tremendous economic hardship. Wind power so-called 'jobs created' are merely jobs purloined from conventional energy companies and come at the expense of jobs throughout the entire economy."

Lindsay North of American Wind Energy Association and Tom Miller, spokesman for Saginaw Future, did not respond to requests for comment.

(Editor's note: Merrill Technologies officials responded after this story originally was posted. The company's comments are included above.)

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

State Budget Shifts Extra Revenue Sharing Funds To Detroit

Detroit to receive $140.5 million; Grand Rapids and Flint to get $12 million combined

Fresh off the Michigan Legislature approving a $195 million bailout for Detroit, some elected state officials and the governor are looking to favor the city again, but this time with the statutory revenue sharing.

Detroit is budgeted in 2014-15 to receive $140.5 million in the money taken from sales tax revenue, a $4.2 million increase from 2013-14. That’s what is proposed in Gov. Rick Snyder’s budget, which is in committee.

By comparison, the city of Flint is budgeted to receive $6.7 million in state shared revenue and Grand Rapids is expected to receive $5.3 million in 2014-15. Detroit has a population of 701,475 while Grand Rapids has 190,411 residents and Flint has 100,515 residents.

Detroit would get 56 percent of all the statutory revenue sharing in 2014-15. There are about 500 municipalities that are eligible to receive statutory shared revenue.

"The state is the most generous with Detroit by far with statutory revenue sharing,” said James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy.

Detroit officials as well as some others have continuously said that Detroit is not getting enough money from the state. For example, the Michigan Municipal League, which represents local communities and advocates on their behalf at the state and federal level, released a report earlier this year that said $6.2 billion in revenue sharing has been "diverted" from local communities. Detroit reportedly lost out on $732 million from 2003 to 2013, according to the Michigan Municipal League report.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.