GM Gets Tax Breaks, Will Keep RenCen Headquarters
DETROIT - The state of Michigan quadrupled its offer to keep General Motors Co. from relocating about 2,000 employees from the Renaissance Center, and teamed with local officials to dangle tax breaks that could total $221 million, reported The Detroit News.
The package helped convince GM to scrap plans to move about half of its work force out of the iconic riverfront complex as part of a broad facilities consolidation. GM also cited the high cost -- tens of millions of dollars -- and disruption of relocating workers to the Warren Tech Center as reasons to maintain a sizeable staffing level at the RenCen.
The sweetened offer ends a prolonged saga that threatened to sap tax revenue from Detroit, which is facing a roughly $300 million budget deficit, and leave GM with a half-empty world headquarters following thousands of job cuts during the company's financial crisis last year. It also ends a tug-of-war between the city and Warren, which was wooing GM to relocate as many workers as possible to the Macomb County community.
In December, GM trimmed the number of workers it vowed to keep at the RenCen to 2,000 from 2,500 despite the Michigan Economic Growth Authority offering a $50 million tax break. The authority has since upped the offer to as much as $200 million, a source told The Detroit News, and GM will keep about 5,000 workers downtown.
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