Pay people to move to Michigan? Whitmer population panel mulls the idea
- Michigan leaders are scrambling to address the state’s slow population growth
- One recommendation in a draft report by the Growing Michigan Together Council would offer incentives to move here
- Nearly 200 communities across the country offer pay-to-move incentives
Gov. Gretchen Whitmer’s commission to address Michigan’s sluggish population growth is considering a proposal to pay people to move to the state.
That’s already being done in some communities and at least one state around the country. But interviews with officials involved with some of those efforts and an analysis of incentive programs by Bridge Michigan pointed out the limitations of the programs. Most have struggled to lure large numbers of new residents, and programs have gone out of their way to avoid using taxpayer dollars to fund the moves.
The one Michigan community that has already tried luring residents with cash incentives was a failure, and no one from the population commission has reached out to the effort’s organizers to hear what lessons could be learned.
Michigan is still the 10th most populous in the nation, but has ranked 49th in growth since 1990, ahead of only West Virginia, prompting job shortages statewide and other looming financial and quality-of-life challenges. Whitmer launched a commission to make recommendations about how the state could retain and attract more residents in May.
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A 40-page draft report released Nov. 30 by the Growing Michigan Together Council included a potpourri of proposals to retain and attract new residents, ranging from overhauling the state’s education system to heavy infrastructure improvements.
Buried on page 26 of that report, which is expected to be the last draft before final recommendations are released Dec. 15, was a suggestion that Michigan “implement novel programs and incentives” that would expand “the talent pipeline for critical knowledge-based jobs.
“Competing with other states for talent requires a combination of targeted marketing, novel incentives and robust policies to reverse current population trends,” the report states. “More and more regions across the country — from northwest Arkansas to Topeka, Kan., to Rochester, N.Y. — are offering relocation incentives, tax credits, and down-payment assistance, and other incentives to attract talent to fill in-demand, high-wage jobs.”
Brittany Hill, spokesperson for the 28-member bipartisan council that will make recommendations to Whitmer, declined to comment on the pay-to-move proposal, but did say all the proposals in the draft document remain subject to change.
The council “is considering potential strategies to support education, economic and infrastructure outcomes in Michigan,” Hill told Bridge in an email. “The proposed recommendations are not final until the council votes.”
Searching for ‘new talent’
Changing Michigan’s growth trajectory “depends on growing and attracting new talent to the state,” Whitmer told reporters in October, when she announced a $20 million ad campaign targeting young college grads in other states.
The hope: if enough young college-educated families are concentrated in one community, businesses will follow.
Beyond ads, administration officials and population commission members want to make Michigan communities more attractive to young families with amenities such as walkable neighborhoods and bike trails. Those types of efforts are credited for rapid growth in communities around Indianapolis and Fort Wayne, in Indiana.
Pay-to-move programs are another option to try to lure those young workers. Efforts have popped up around the country in recent years, but are still rare in Michigan.
A website called MakeMyMove lists 191 U.S. communities that offer incentives, some as modest as tickets to museums, and others offering as much as much as $12,000 cash for new residents who meet certain criteria — often remote workers or business owners who can operate their businesses from anywhere.
Just to Michigan’s south, there are 42 communities in Indiana that offer incentives to new residents. For example, rural Wabash County in north central Indiana, with 30,000 residents, is offering $5,000 in relocation costs for remote workers or the self-employed who earn more than $50,000 a year.
By contrast, there are only two active programs listed in Michigan: in Jackson, where the main incentive ($25,000 down payment assistance on a home built in the city) is also offered to current Jackson residents; and Muskegon County, where the freebies don’t include any cash, but do include two tickets to the Muskegon Luge Adventure Sports Park and a one-year membership to the Muskegon Chamber of Commerce.
There was a remote worker incentive program in west Michigan’s Berrien County, but it ended in 2022 after attracting just seven new families.
The only state currently offering incentives for people to move there is West Virginia, the one state that has even slower population growth than Michigan. Its program pays $12,000 cash to people who hold jobs outside of West Virginia that can be done fully online, or to people who own businesses that can be operated fully remotely. The newcomers get $10,000 in payments over the first year they live in West Virginia, and another $2,000 over the second year.
If Michigan were to offer the same $12,000 incentive as West Virginia, and wanted to attract 5,000 new workers and their families, it would cost $60 million.
And that’s assuming Michigan can lure remote workers even by paying them to move here, which hasn’t been the case in some incentive programs around the country.
Rochester, N.Y., offers remote workers up to $10,000 in relocation reimbursement to move to the region, and up to another $9,000 in homebuyer grants.
Even with $2.5 million in initial funding from private sources, the program is far behind its projections for luring people. Launched in April 2022, the program set an initial goal of 100 new residents in the first year of the program, 200 in the second and 300 in the third.
Nineteen months into the program, out of about 4,000 applicants, there are just 65 families that have moved to Rochester, said Melanie DellaPietra, talent strategy partner for the program, Greater ROC Remote.
DellaPietra said the program is considered a success locally, and only one person who moved to Rochester through the incentive has moved away so far, but she acknowledged that getting people to move isn’t easy.
Some who were accepted into the program discovered that their jobs weren’t as “fully remote” as they had thought, and their employers didn’t want them to move away from their home base. Others dropped out because of family issues or because they struggled to find housing in the Rochester area.
Topeka, Kan., offered $10,000 for out-of-state remote workers to move to the community. The program launched in 2020, but ended two years later.
Trina Goss, director of business and talent initiatives for Go Topeka, which operated the Choose Topeka program, said 29 families moved to the city through the two-year remote worker program, while a similar incentive program to attract new employees to existing Topeka businesses drew 118 workers in the same time. Now, the organization is gearing up to start two new incentive programs for new residents, one for “boomerangs” (people who left Kansas and want to move back), and one for soldiers leaving the military.
Berrien County cautionary tale
Move to Michigan was launched in 2020 to lure remote workers to west Michigan’s Berrien County. Run by the local economic development organization Cornerstone Alliance, the program offered remote workers who lived outside Michigan $10,000 to move to Berrien County, and another $5,000 if they had children who enrolled in local schools.
The organization allocated $250,000 from a property sale for the program, with a goal of getting 25 families to move to the county.
But after two years and more than 4,000 applications, only seven families moved there.
The biggest reason: a lack of available housing.
Workers kept being out-bid on homes in the county, said Christina Frank, vice president of external affairs for Cornerstone. When a 16-unit apartment complex opened in the county, all the apartments were leased in a matter of days.
“It came to the point where you were setting people up for frustration,” Frank said. “There were people who spent months putting in multiple bids. We couldn’t keep putting people through the process.”
Cornerstone ended the program in 2022.
“Something like 1-3 percent of the entire population of the country moves from state to state every year, and so I’m not sure that’s where we want to put this focus,” said Rob Cleveland, president and CEO of Cornerstone.
The experience left Frank skeptical of efforts that attempt to lure people from around the country who have no existing connections to Michigan.
“There’s a misconception that you can go into San Francisco and advertise how cheap it is in Michigan and get them to move here,” Frank said.
The organization has conducted surveys that indicate people tend to relocate within a two-hour radius of where they currently live, and move to locations where they already have family or friends, or have visited numerous times for vacations.
“It doesn’t move the needle to have people move here for a couple years and be miserable and move out.”
Even though Berrien County’s failed pay-to-move initiative is the closest example of the incentives the state population commission is considering, no one from the state’s Growing Michigan Together Council has reached out for information about what worked and what didn’t, Cleveland said.
Lessons from pay-to-move programs
There are similarities among the pay-to-move programs offered around the country that Michigan may want to keep in mind:
No tax dollars. Most programs are funded through grants from foundations or contributions from individuals or businesses. West Virginia’s program is funded primarily through donations from Brad Smith, the founder of tech firm Intuit and a West Virginia native. Tulsa Remote, which offers $10,000 for remote workers to move there, is funded by the George Kaiser Family Foundation, which is headquartered in Tulsa.
Rochester’s program is funded by local companies. “I would highly recommend private funding,” said Rochester’s DellaPietra. “A lot of people have said, ‘Are my tax dollars paying to move people here?’”
Topeka is the exception, with funding coming from funds that are collected through a half-cent sales tax that goes to Go Topeka, an economic development organization.
Restrictions on who qualifies. Most programs limit recipients to people who currently live in another state. Most also have income minimums —— $50,000 to qualify for remote worker incentives in Lincoln County, Kan., population 2,903 (where the perks include $4,500 cash and “a dozen farm-fresh eggs every month for a year”) and $100,000 in Frankfort, Ky.
Everyone wants remote workers. Almost all programs target workers who do their jobs online. Tulsa was a pioneer in such efforts, and has drawn 2,000 people to the city since the program began in 2018. Nine out of 10 stayed in Tulsa after their one-year incentive program ended. But with almost 200 communities now offering pay-to-move programs, the incentives are no longer unique and don’t get the national headlines Tulsa received five years ago. Remote workers now have lots of options where they can get paid to move, which makes it harder for any individual program to draw interest.
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