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Pure Michigan gets reprieve, but its future is cloudy amid budget showdown

LANSING –  The Pure Michigan tourism advertising campaign will continue through the end of the year – and the brand will live on even longer –  despite a funding veto Democratic Gov. Gretchen Whitmer issued amid an ongoing budget dispute with the Republican-led Legislature.

The Michigan Strategic Fund, which Whitmer reshaped last month with new appointments, voted Tuesday to use leftover money from last fiscal year to continue paying the advertising and public relations firms behind the Pure Michigan campaign. 

The state will pay ad firm McCann $667,500 in unexpended “work project funds” for travel and marketing ad services through Dec. 31. 

The board also approved $73,100 for Weber Shandwick to wrap up ongoing public relations and social media projects before transitioning responsibilities to in-house staff at the state-funded Michigan Economic Development Corp.

McCann and Weber are both based in New York but have offices in Metro Detroit. 

Without new funding, Pure Michigan ads will “by and large” stop running by the end of the year, said Doug Kuiper, senior vice president of marketing and communication for the MEDC. 

However, staff at the quasi-governmental agency is set to take over related social media accounts and public relations campaigns that had been managed by outside firms, he said. 

“We will definitely continue to extend the brand in every way we're able to,” Kuiper told reporters in a media briefing call. 

“We have a small team. It’ll be a significant lift taking that effort in-house, but we’re committed to the brand. We believe it’s valuable to the state.”

Whitmer has praised Pure Michigan, calling it a "fantastic" ad campaign that "gives us all pride." But the governor had proposed cutting $5 million from the program and later vetoed all $37.5 million in Pure Michigan funding in a budget developed by the Republican-led Legislature. 

That rejection was part of Whitmer’s $947 million veto spree designed to push lawmakers back to the negotiating table.

While it's possible the governor and GOP leaders could agree to restore the Pure Michigan funding before the campaign is shuttered, neither Republicans nor Democrats proposed doing so two weeks ago when they introduced a series of supplemental spending bills.

Amanda Bright McClanahan, chief operating officer for the MEDC, said the agency is not involved in those negotiations but said lawmakers have reached out asking how long the Pure Michigan campaign could survive without long-term funding.

The temporary contract extensions approved Tuesday will “use up the remainder of the prior-year money that's available for Pure Michigan, allowing us to continue operations through the end of December,” McClanahan said. “That's consistent with what we've been talking about with the Legislature for the last few weeks.”

Pure Michigan ads, which promote local tourism destinations and feature the iconic narration of Birmingham-raised actor Tim Allen, began running in 2006. The Travel Michigan tourism promotion office oversees the effort within the MEDC. 

For 13 years, Pure Michigan has emerged as a ubiquitous brand for the state. Its logo has been plastered on everything from license plates to private company billboards to clothing. 

But experts have long debated the value of the campaign, and how far its reach extends beyond the feel-good pride it can instill in local residents. MEDC touts paid research to make the case for its effectiveness. 

Most recently, Strategic Marketing and Research Insights of Indianapolis found the ads returned $9.28 in state tax revenue for every $1 spent outside the state in 2018. 

As Bridge Magazine previously reported, skeptics have questioned those return-on-investment numbers, and they have not been independently verified. Pure Michigan is significantly larger than just out-of-state ads, which accounted for roughly $16.5 million in spending in 2018. 

“The program is not only ineffective, it is unfair and expensive," said Michael LaFaive, fiscal policy director for the Mackinac Center for Public Policy. The free market firm conducted its own study in 2016 and found that every dollar Michigan spent on tourism promotion returned created only 2 cents of value for the state's hotel industry. 

The $37.5 million the Legislature had earmarked for Pure Michigan would be better spent on "something that does produce a positive return on investment, like an efficient road system and better bridges," LaFaive said, praising Whitmer’s veto. 

“Whether it was a bargaining chip or not, I recommend that the line item stay at zero (dollars) for the sake of our roads or some other higher priority,” he added.   

McCann helped create Pure Michigan, and the leftover funding approved Tuesday “will allow the agency to continue working on projects in progress, including the fall, urban and winter travel marketing campaigns,” Kuiper said in a recommendation letter to the strategic fund board.

Without state funding, the board was unable to vote on an an optional contract extension for Weber Shandwick, whose current deal expired Aug. 28.  The one-month allocation approved instead "will allow the agency to complete projects in progress and transition to MEDC internal staff the work it is currently doing to support travel," Kuiper said. 

Those efforts, he explained in the recommendation letter, include managing Pure Michigan social media accounts, pitching stories to travel media, supporting golf public-relations initiatives, developing content for michigan.org and coordinating “influencer” trips to Michigan to raise awareness of it as a “national leisure travel destination.”

Whitmer reconfigured the Michigan Strategic Fund Board of Directors in June as part of a broad executive order. She appointed five new and two returning members in September. 

The 10-member board is chaired by MEDC executive officer Jeff Mason and also includes director of the Department of Labor and Economic Opportunity Director Jeff Donofrio and state Treasurer Rachael Eubanks.
 

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