FY2018 Michigan Strategic Fund Act Annual Report
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DATE: March 15, 2019 TO: The Honorable Gretchen Whitmer Governor of Michigan Members of the Michigan Legislature FROM: Jeff Mason, President Michigan Strategic Fund SUBJECT: FY 2018 MSF-MEDC Annual Report The Michigan Strategic Fund (MSF) is required to submit an annual report to the Michigan Legislature summarizing activities and program spending for the previous fiscal year. This requirement is contained within the Michigan Strategic Fund Act (1984 PA 270) and budget boilerplate. Attached you will find the annual report for the MSF and the Michigan Economic Development Corporation (MEDC) as required in Section 1007 of 2018 PA 207 as well as the consolidated MSF Act reporting requirements found in Section 9 of the MSF Act (MCL 125.2009). In an effort to further consolidate legislative reporting, the attachment also includes the following budget boilerplate reports. • Michigan Business Development Program and Michigan Community Revitalization Program amendments – Section 1006 • Jobs for Michigan Investment Fund – Section 1010 • Michigan Film and Digital Media Office Activities – Section 1033 • Business Incubators and Accelerators annual report – Section 1034 Also included in the attachment is an annual status report for the Community College Skilled Trades Equipment Program (CCSTEP) which is now administered by the Talent Investment Agency. Please contact the MEDC Office of Government Relations at 517.335.1847 if you have any questions. Attachment cc: Chris Kolb, State Budget Director Chris Harkins, Director, Senate Fiscal Agency Mary Ann Cleary, Director, House Fiscal Agency Gary Randall, Clerk, Michigan House of Representatives Margaret O’Brien, Secretary of the Senate 2018 YEAR MSF/MEDC Annual Report to the Legislature FISCAL MSF/MEDC FY 2018 TABLE OF CONTENTS Executive Summary .............................................................................. 3 COMMUNITY VITALITY (CORE FOCUS) Community Development .................................................................111 BUSINESS INVESTMENT (CORE FOCUS) Michigan Community Revitalization Program (MCRP) .........113 Michigan Automotive Office ........................................................... 10 Community Development Block Grants ...................................125 Pure Michigan Business Connect ..................................................12 Brownfield Tax Increment Financing (TIF) ................................126 Michigan Business Development Program (MBDP) ................14 Michigan Council for Arts & Cultural Affairs ...........................128 Good Jobs for Michigan Program (GJFM) ................................42 Core Community Fund ....................................................................129 State Essential Services Assessment (SESA) & Alternative SESA Exemptions ....................................................43 IMAGE Michigan Defense Center ................................................................44 Travel Michigan ...................................................................................130 Procurement Technical Assistance Centers (PTACs) ...........46 Business Marketing ............................................................................135 International Trade Services ...........................................................47 Michigan Film and Digital Media Office ......................................65 LEGACY PROGRAMS Tribal Business Development .......................................................... 72 Brownfield Redevelopment Program Michigan Renaissance Zone Program .......................................... 74 (MBT amendments) ...........................................................................139 Next Michigan Development Corporation ................................ 75 Michigan Film Incentives ................................................................140 Capital Conduit Program ................................................................. 76 Michigan Economic Growth Authority ....................................... 141 Michigan Income & Principal-protected Growth Fund ........ 77 Michigan Tool & Die Renaissance Recovery Zone Program ..................................................................142 Michigan Supplier Diversification Fund ......................................78 Accelerator Fund ............................................................................... 143 SSBCI Federal Awards ......................................................................79 21st Century Investment Fund ...................................................... 144 Small Business Capital Access Program.................................... 80 Centers of Innovation ...................................................................... 145 Private Activity Bonds .......................................................................84 Competitive Edge Technology Grants and Loans Business Incubators & Accelerators ............................................85 Determined by Commercialization Board ............................... 146 Early Stage Funding Programs .......................................................87 Pure Michigan Venture Development Fund ........................... 148 Entrepreneurial Support Services and Pure Michigan Venture Match Fund ..........................................150 Entrepreneurial Service Providers ...............................................96 Retention of Pfizer Assets: Company Programs Administered by Grantee ............................................98 Formation and Growth Fund Loans .............................................151 Michigan Translational Research and Commercialization Program ...................................................99 ADMINISTRATIVE Michigan University Technology Acceleration Jobs for Investment Fund: Permanent Fund ...........................152 and Commercialization Program ..................................................101 MSF Activities: Section 88b(2)(c) .................................................153 Michigan University Early Stage MSF Work Project Information .....................................................155 Proof of Concept Program ............................................................102 MSF Special Legislative Grants ....................................................156 Michigan Economic Development Corporation Award Approvals ...............................................................................103 MEDC Budget vs. Actual Expenditures ...................................160 Community College Skilled Trades MSF Budget vs. Actual Expenditures ..........................................161 Equipment Program (CCSTEP)....................................................104 MEDC and MSF FTE Position Count .........................................163 MSF/MEDC Annual Report to the Legislature // FY 2018 // 2 MSF/MEDC FY 2018 EXECUTIVE SUMMARY he Michigan Strategic Fund (MSF) is required Sec. 9 (1)(i) requires a list of all entities that are in to submit an annual report to the Michigan bankruptcy, that the fund has received actual notice of, Legislature summarizing activities and program filed by a direct recipient of an active single incentive Tspending for the previous fiscal year. This of at least $500,000. The MSF received no bankruptcy requirement is contained within the Michigan Strategic notifications in FY 2018. Fund Act (MSF Act) (1984 PA 270) and the budget boilerplate. The MSF board has granted authority to the Sec. 9 (1)(j) requires a summary of the approximate Michigan Economic Development Corporation (MEDC) administrative costs used to administer the programs and to provide administrative services to the MSF for a variety activities authorized under the MSF Act. This information of programs overseen by the MSF. is included in the MSF expenditures page of this report. The MSF Act was amended in 2005 to add the 21st Finally, beginning July 1, 2015, Sec. 9 (14) requires the Century Jobs Fund (21st CJF) programs. In more report to include a copy of the site visit guidelines for recent years, the MSF Act was amended to update and each program that provides financial assistance under the add new programs, including the Michigan Business Act and the number of site visits conducted under that Development Program (MBDP), Michigan Community program. This information is available at the links below: Revitalization Program (MCRP), and the Good Jobs for MBDP Site Visit Guidelines: https://www. Michigan program. With these changes, the MSF Act michiganbusiness.org/498d8d/globalassets/documents/ and MSF board now oversee most of the state’s economic michigan-business-development-program-projects/ development programs. mbdp-program-site-visit-guidelines.pdf Several bills were enacted in 2014 that made various MCRP Site Visit Guidelines: https://www. changes to the MSF Act that were designed to provide michiganbusiness.org/498da8/globalassets/documents/ greater flexibility, eliminate duplicative efforts and michigan-community-revitalization-program-projects/ streamline processes. Among the changes is 2014 PA mcrp-site-visit-guidelines.pdf 503, which amended and consolidated all reporting MSF Site Visit Guidelines: https://www. under Sec. 9 of the MSF Act (MCL 125.2009), including michiganbusiness.org/49b696/globalassets/documents/ requirements for MBDP, MCRP, tourism and business reports/msf-reports/msf-site-visit-guidelines-3-1-16.pdf marketing, and the 21st CJF annual report. FY 2018 OVERVIEW Some of the programs summarized in this report are Michigan is positioned