LANSING, Mich. (WOWO)— Michigan lawmakers are advancing proposals to dismantle the Michigan Economic Development Corp. (MEDC), the state agency responsible for business growth, corporate incentives, and economic development programs.
House Republicans unveiled two bills this week that would halt the MEDC’s authority and eliminate the interlocal agreements that extend its reach across the state. The legislation comes one month after lawmakers cut the agency’s budget amid criticism of costly and failed incentive programs.
“The MEDC is beyond repair,” said state Rep. Jay DeBoyer, R-Clay Township, chair of the House Oversight Committee. He cited investigations showing that just 20% of the 65,000 jobs promised through cash-for-jobs deals were delivered. Several high-profile projects, including Gotion Inc.’s battery plant and a Sandisk semiconductor plant, fell through despite millions in state incentives.
Co-sponsor Rep. Steve Carra, R-Three Rivers, said the bills focus on the “gut of corporate giveaways” and aim to reassess Michigan’s economic development approach. The legislation would maintain the public funding arm, the Michigan Strategic Fund, but prevent the MEDC from negotiating new deals.
Supporters of the MEDC point to the agency’s role in securing national business investments, training thousands of workers, and supporting small businesses, which last year generated over $2.7 billion in new revenue. Gov. Gretchen Whitmer has vowed to veto any bills that dismantle the agency, warning that the move could hurt Michigan’s economy and business climate.
“The Republican plan would put a ‘closed for business’ sign at Michigan’s border,” said Whitmer spokesperson Bobby Leddy.
The House proposals follow a Senate package introduced last week by Sen. Thomas Albert, which would also eliminate the MEDC and create a Bureau of Fair Competition and Free Enterprise with independent oversight of taxpayer-funded projects.
The MEDC, created in 1999, operates under the Department of Labor and Economic Opportunity but remains legally separate from the state. It oversees programs such as historic preservation, internship programs, and tourism marketing. Its 2025 budget totals $83.7 million, primarily funded by tribal gaming revenue, with an additional $1.6 billion in state funds managed annually.
If lawmakers pass the bills, Whitmer could veto them, but the Legislature has the option to override with a two-thirds vote in both chambers. House Republicans hold a slim majority of 58 out of 110 seats, while the Senate includes 19 Democrats and one vacancy. Debate over the future of Michigan’s economic development strategy is expected to intensify in the coming months.
