Advocacy group tells Michigan subcommittee Mega tax credits cost "billions" and recommends redirecting funds to schools and infrastructure

Charlie Kemp and Charlie Cavell of Fund My Future told the Michigan House subcommittee that the Mega tax credit program produced poor value for taxpayers and recommended steering resources toward schools, roads and workforce programs.

Kemp described the Mega credits as a subsidy that "gave selected tax breaks equal to the wages, profit sharing, and health care benefits they paid qualifying employees in Michigan," and argued the program "essentially passed the cost of wages onto the Michigan public rather than the companies profiting off of their labor." He said the credits were "an abject failure" and that, unless changed, the credits would cost the state about $2,000,000,000 "through the end of the decade." He also cited historical budget impacts: "In 2015, Michigan legislature had to cut an unexpected $325,000,000 from the budget due to unforeseen credits being redeemed," Kemp said, and he cited a later year when the state collected about $1,300,000,000 in corporate tax revenue but paid out $511,000,000 in Mega refunds.

Kemp referenced the Office of the Auditor General's work saying companies did not always meet job creation or retention commitments: "An audit by the Auditor General ... found that in 2015 alone, companies receiving mega credits had only created 48% of the standard new jobs that they promised they would. Only 39% of the high‑tech jobs that they've promised, and just 83% of the jobs that they promised to keep in state."

Cavell said the issue resonates across political lines and that most residents "want [taxes] to go towards things that make their quality of life better." Kemp and Cavell argued the billions spent on Mega credits could be used for education, trade and infrastructure programs. "If we really want to quote unquote fix the **** roads, $2,000,000,000 could go towards that goal rather than corporate handouts," Kemp said.

During questioning, proponents and critics across the committee probed whether incentives are politically durable, whether incentives deliver the promised jobs, and whether a broad, consistent tax or infrastructure investments would be preferable. Fund My Future representatives said subsidies tend to benefit the well‑connected and can exacerbate income inequality, and that stopping corporate tax cuts in favor of public investments would produce fairer outcomes for students and working families.

The subcommittee heard the testimony as part of a broader review of legacy incentive programs and their fiscal and economic consequences; no legislative action was taken at the hearing.