Q-and-A: New MEDC chief offers blueprint for Michigan’s economy

jeff mason

Jeff Mason: “This is a time to step on the gas and kind of see if we can’t really amplify some of the things we’re doing in terms of job growth.”

LANSING — Jeff Mason’s path back to the Michigan Economic Development Corp. began this past spring with a chance run-in with Doug Rothwell, who heads the powerful Business Leaders for Michigan, the state’s business roundtable.

Mason was nearly eight years into his role as executive director of the University Research Corridor, leading collaboration among the state’s major research universities — Michigan State University, the University of Michigan and Wayne State University — when Rothwell asked if he was interested in coming back to the MEDC as its CEO.

Rothwell told him that then-head of the MEDC, Steve Arwood, was thinking of leaving (Arwood would step down in June). “That kind of led to a number of conversations with (Gov. Rick Snyder) and others,” Mason said, “and ultimately the governor then recommending my name to the board.”

Mason, 58, was confirmed this month as MEDC CEO by the agency’s executive committee, led by Rothwell, who also once held the position.

Mason worked for the MEDC under two governors from 1999 to 2009, including as senior vice president for business development.

Bridge/Crain’s recently spoke with Mason about his vision for the agency, which he said includes opportunities in vehicle mobility, defense, information technology and agriculture. A condensed version of the interview appears below.

Bridge/Crain’s: What will be your approach to economic development as CEO?

I’m really going to get out across the state... and really listen to (community leaders) and understand kind of where they’re at. ... We’re more effective working together.

The governor made a point in my conversation with him about, this is not a time to coast or slow down. This is a time to step on the gas and kind of see if we can’t really amplify some of the things we’re doing in terms of job growth, community development, some of the activities that we already have underway.

What are your thoughts on the Good Jobs for Michigan and transformational brownfield incentives recently passed by the Legislature?

We are very appreciative of the Legislature and the governor in terms of supporting that, and the local organizations around the state were very supportive of helping to get that legislation through. I think they’re both tools that are measured responses to what is taking place in the marketplace and will give us additional tools to really help, not only for the community development projects but also to go after some of those large attraction activities and not just compete, but hopefully win.

Do you think Michigan has been competitive with other states for those larger projects?

We were competitive to a degree. The efforts that have taken place over the last six years in terms of the changes to the tax structure and some of the business climate issues in terms of regulatory or energy costs — I mean, I think we have a solid foundation that has allowed us to compete and be successful, to a degree. I think the Good Jobs for Michigan package (of) legislation hopefully will allow us to compete and win some of the larger projects. And the landscape, as you well know, in terms of what other states are doing to compete for those projects is very competitive, whether it’s free land or sites or closing funds.

Are there other gaps in the incentives toolbox?

I don’t see any right now. If you look at kind of the competitive landscape, we are not going to compete on a lowest-cost basis, because I don’t think we should. The value we provide in terms of the talent, in terms of the workforce, the infrastructure in terms of the roads and transportation, the education system — we provide, I think, a competitive product at a reasonable cost. … That Good Jobs for Michigan package kind of is the icing on the cake, if you will.

How involved have you been with efforts to lure Taiwanese electronics manufacturer Foxconn Technology Group to Michigan?

I have tried to not engage or really get into the specifics on the deal flow for any particular project, really, until I was on board. … I really wanted to have that firewall.

Why, do you think, is the MEDC often in the legislative budget crosshairs?

It’s a healthy debate that occurs within our state and within democracy. I think, first and foremost, what this state has done over the last six years is really get its house in order in terms of fiscal management. … I think we’ve created that solid foundation. Then it’s a question of what other policies or programs do we put in place that help us to be competitive. … Incentives probably get a lot of focus and attention, and that’s fair. But I think there’s other things that are going on within the economic development organization here at the MEDC — things like the Pure Michigan Business Connect program, which is all about connecting large Michigan companies to smaller companies. … That’s not about incentives. That’s about creating the right opportunities to help our existing Michigan companies be more successful.

What are your thoughts on the MEDC’s community development side?

I think about creating the right environment within our communities so that people want to live in these communities and then go to work for some of these great companies. … There’s a lot more going on, I think, that has as much or maybe more impact than kind of the big Strategic Fund meetings and the deals.

About The Author

Lindsay VanHulle

Lindsay VanHulle covers business and Lansing for both Bridge and Crain's Detroit Business. She can be reached at lvanhulle@bridgemi.com

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Comments

Rick
Mon, 07/31/2017 - 8:38am

MEDC - another 'SPARK'. Smoke and mirrors on 'job creation'. Until an independent audit gets done and everyone can see the dismal numbers on jobs.

MEDC will never allow such an audit...the emperor has no clothes.

duane
Mon, 07/31/2017 - 10:53am

Here we go, another 'glad hander' and 'feel good' with not idea how to change or use the means/methods businesses use gain and retain customers wit their services [they don't hand out other people's money].

If he wants to change the business relations and successes in Michigan he needs to learn how businesses gain and retain clients. They do it by delivering services that add value to the clients operations. They do by creating new/innovative ways for doing business, Michigan needs to do better with businesses by being a problem solver with government services.

Mr. Mason needs to break out from the standard tax incentives for manufacturing and look for what the service businesses will need tomorrow. Michigan can still strive to be a manufacturing state, but it needs to accept today and tomorrow is/will be a knowledge and skills leverage economy, a service economy, he needs to look ahead to how Michigan can deliver service that exceed those needs better than any other state.

Mr. Mason can press the 'flesh' with all the CEOs in the State, but what he needs to do is have a disciplined conversation with their successors about the future, about the barriers Michigan creates for business, the other barriers the businesses experience or anticipate, about how to address them, and about how the State can help address those barriers in new an innovative ways.

Mr. Mason needs to get over the hype of his title and change how Michigan serves business and its residents. He may want to do an assessment of our work force and identify what it needs to be, assess our infrastructure and realize tomorrow is about data and not about roads, he needs to assess the culture and prepare it to be a culture of innovation/creativity, of learning, of accountability.

Mr. Mason needs to establish some performance metrics so he and others will be able to identify was is work and what needs to be changed.

I don't know Mr. Mason but the history of his office precedes him and it offers little hope for change and being a leader tomorrow.

duane
Mon, 07/31/2017 - 7:18pm

I hope Mr. Mason looks at Michigan develop in three parts, the established businesses, the established out of state business want to grow, and new/developing businesses at the grassroots stage [those needs support in all phases] of a new or innovative business.

Those beginning stage companies are ripe for learning about the the needs for the future and the services the State can be a part in delievering.
In addition to Mr. Mason's plan to meet with the kep people at the established businesses, I would encourage him to meet with and develop an idea group of venture capitalists. They are already the source of money for new and expanding ideas/business, they are also versed in the support needs for those early stage businesses. I would encourage Mr. Mason work with the VCs to identify some candidate communities [such as Traverse City, Kalamazoo, Muskegon, Holland] to become incubator communities for developing resources [in the local schools, high schools, community colleges, full program colleges] knowledge and skilled people. Encouraging a couple of VCs to adopt each of these towns to be a coach for their incubator development.

Grand Rapids has a new cloud server farm, this could be a catalyst for each of these towns. Not being a techie but appreciating the the need for 'big pipes' to handle data transfers. Grand Rapids might be that data hub that the State could support the necessary infrastructure to tie those towns together for the effective and efficient data sharing and using.

Who else has ideas? It is best to get them into Mr. Mason now before Lansing engulfs him with the past and how that is the only way to prepare for the future.

J Hendricks
Mon, 07/31/2017 - 12:11pm

Mason is right when he points out that there are other things besides incentives in the "developers toolbox." A good example is from the recent Foxconn deal in Wisconsin where part of the deal to secure 13,000 manufacturing jobs included the outright waiver of a n umber of environmental regulations in order to speed up construction of the $10 billion dollar, 20 million sq foot building. Recall this is the company that built a complete factory and hired the engineers on the come just to be able to secure an Apple contract - and be able to essentially start production the next day! Our regulators live in a different world where time has no meaning - but time is everything in the real world. Good luck Jeff.

Kevin Grand
Mon, 07/31/2017 - 3:25pm

Does anyone find it ironic that Lansing cannot stop tripping over itself in order to provide "incentives" to businesses, yet the very same politicians went totally apoplectic when someone had the gall to propose returning money to Michigan Taxpayers (the REAL economic engine) by lowering the Michigan Income Tax?

Does anyone find it even more ironic that these programs are never proposed during an election year?

Just an observation.

Larry Krieg
Mon, 07/31/2017 - 6:15pm

I've just returned from a month's travel in Australia and Japan. When I explain to people that I'm from Michigan, my interlocutors generally brought up one of two things they remember about Michigan: Detroit's bankruptcy, and the Flint water crisis. If this is what people identify Michigan with, our economic development folks need to be front-and-center with their response to the international reputation Michigan has earned. I didn't see this in the interview; rather, I saw a focus on in-state politics and policies.

I'd like to share an insightful comment made in January, 2012 from Carlos Ghosn, then head of the Nissan-Renault Global Alliance - a company making approximately one of every ten automobiles in the world. He was speaking to a group of engineering students at U of M (I snuck in!) about the future of automotive manufacturing around the world. One grad student asked what factors would lead Nissan-Renault to choose one location over another when deciding where to build a new manufacturing facility. In response, Mr. Ghosn drew a quick comparison between three countries: China, India, and Brazil. China and India are roughly equal in population, very different in culture. Brazil has much lower population and is blessed with abundant natural resources. Which of them should have the fastest-growing economy? Here's my transcript of the core of his statement:

"Brazil is an extremely rich, rich country. Even with this, China has a much higher growth rate than India, and much higher growth rate than Brazil. It's really surprising! You say, well you know what? Brazil should grow more than China, because there is less population and there is a high density of leveraged companies with a lot of resources, but still the growth rate of Brazil is lower than China. And if you try to analyze why, at the end of the day you come - and I'm not trying to make a kind of focal analysis of it - but I would say that the one fundamental factor is, the Chinese always and systematically have dedicated a lot of resources to their infrastructure, and they have been building infrastructure before people need the use of infrastructure. ...
"And in fact, our own investments, when we have been studying to go to a country and how much we should invest in a country, always takes into consideration how much funds the country - how much attention the country is dedicating - to developing infrastructure. ...
"Frankly, nothing can replace the necessary investment in infrastructure, especially important in emerging markets."

My take-away: if Michigan wants to re-emerge as a global economic force and an attractive place to live and work, we must stop talking about cutting taxes, and start re-investing in our infrastructure. We can't afford another Flint-style infrastructure crisis. No amount of private spending will replace large-scale (i.e. government) investment in water, power, transportation, and education for Michigan.

Jesse
Mon, 07/31/2017 - 9:16pm

MEDC is just a continuing gov't agency boondoggle. What has this agency done that has helped anything economic in Michigan? More incentives to attract manufacturing ...and just where does that money come from? It comes out of the hides of every tax paying business and citizen. Gov't in Lansing is nothing more than alphabet soup of agencies that actually do very little to help the economy. When has gov't ever listened to business's or the voters? Why should I believe this guy will make any difference what so ever? Just another agency boondoggle....

Marc
Tue, 08/01/2017 - 11:51am

Having worked for the predecessor of MEDC I can see why many of the comments are skeptical of Mr. Mason's ability to affect positive change. However, I have known Mr. Mason for a long time and can tell you he understands the problems with the organization and he also understands what it will take to put our state in a leading position. To the extent an organization like MEDC can make a positive impact Mr. Mason is the person to get the organization headed in the right direction.

duane
Tue, 08/01/2017 - 3:27pm

Marc,

This is all well and good, I believe his predecessors and those who have worked and are working in the office of MEDC are well intended and are pointed in the right direction, but execution and the nature of what is being said all seem more of the past than for the future.
The challenge for MEDC and the rest of government is that they have lived/worked in the shadows of the elected officials for so long that their image is link to the impressions of politicians and the perception of Lansing insulating itself from the public. Much of the public workers in private industry where results are reported at least quarterly if not monthly, and they are held accountable for the results. When has MEDC gone public with goals of measurable results, when have they reported regularly on delivered results let alone expected results?

Even this article spent much time of how Mr. Mason got here, but with all that experience he should little understand of how MEDC operations, but nothing from him about what his personal style [willingness to be held accountable by the public] is, how he believes it will impact MEDC and the Michigan, and what he had learn about concerns for the future.
The reality is that Mr. Mason has few opportunities to make a first impression. In this case he has made non so that only leaves us to use what the past has shown us about MEDC and those who held the office he has succeed to.
I have had limited contact with government and non that I can recall with MEDC, so I am likely wrong, but if Mr. Mason doesn't allude to something changing in MEDC's approach we can only use history as our reference for what to expect.

Rick
Mon, 08/07/2017 - 9:20am

'Much of the public workers in private industry where results are reported at least quarterly if not monthly, and they are held accountable for the results. When has MEDC gone public with goals of measurable results, when have they reported regularly on delivered results let alone expected results?'

Yes. And MEDC and SPARK resisted this concept until finally SPARK was forced to do an audit of its 'job creation' (Snyder claimed as many as 13,000 jobs) and the result? 169 documented jobs in 1 year. SPARK was quite good at creating jobs at SPARK - they grew to 188 employees over the years.

Thomas Ford
Sun, 08/06/2017 - 6:49am

The Michigan worker seems to be the red-headed stepchild in the room whenever economic development is discussed. I don't think union/collective bargaining groups have been formal policy making members of the MEDC. Is that why specific workers rights, wages and benefits seem to be afterthoughts?

I see it happening every day. Companies come into a community, hold it hostage until some sort ransom is paid in the form of tax abatements/financial incentives with worker issues never becoming part of the equation.

Case in point. I read recently that the State of Michigan is going to allow certain companies to receive certain taxes that their employees would normally send to the state as ransom payments regardless of the profits they have made/will make under such an agreement If the state won't pay, the corporation threatens to move south and take their potential jobs with them where there is much less concern for workers wages, rights and benefits. In the not to distant past an idea like that would never even be brought up. Now in the age of American Corporatization of government everything is on the table except worker issues. The corporations receiving these financial windfalls will not be spending the bulk of those funds in the communities where they will be built, but merely added to their bottom line. If the state would split those corporate tax breaks with the corporation's employees we would all be better off in the long run.

From my understanding the Brownfield Incentive legislation did not increase the funds for Brownfield Reclamation but merely divided the funds now available with an ever increasing number of communities needing assistance. I don't think that strategy will work if we are really going to reclaim many of those properties