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A Better Partnership

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Mar 2011
06
March 06, 2011

Byl Discusses Brownfield Tax Credits in GR Business Journal Article

In the Grand Rapids Business Journal this week, Warner Norcross Partner John Byl writes that the skyline of Grand Rapids would be an extremely emptier place without the use of brownfield tax credits. Byl, who chairs the Michigan chapter of the National Brownfield Association, supports keeping the tax credit program, which is slated for elimination in the proposed state budget. He calls the program the "best economic development tool available in our state." He notes the program spurs urban redevelopment, provides Michigan a competitive edge, reduces financing worries for developers and offers excellent return on investment for the state. Here are some of the points he makes in the article:

  • Urban redevelopment: Unlike some government programs, brownfield tax credits are truly stimulus-based credits. They induce private investment as a condition of receiving the credit, encouraging private developers to give new life to blighted urban properties and renewing downtown cityscapes. And the developer only receives the credit after the investment is made.
  • Excellent ROI: As an investment, brownfield tax credits have proven their worth and provided an excellent return. These credits leverage capital investment of at least 10 times the amount of the credit. As an added bonus, thousands of new jobs are created.
  • Competitive edge: The pool of competition has increased exponentially since brownfield tax credits were first introduced in 2000. Michigan is recognized nationally as a leader in brownfield redevelopment. We stand to lose this competitive edge — and subsequent investment from all developers — if we eliminate brownfield credits.
  • Reduce financing worries: A developer who goes to a lender with brownfield tax credits in hand is far more likely to secure bridge financing for a project. This is particularly critical when it comes to high-dollar redevelopment plans.

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