×

Talks with GM are about investment, not clawback

LORDSTOWN – There’s really no disputing General Motors broke an agreement with the state that gave the automaker millions in tax incentives for its former Lordstown assembly plant when the company shuttered the facility last year.

But talks concerning recouping some or all of the $60.3 million appear to be less about the clawback and more about GM making further investments in Ohio.

Said DeWine of GM, “They have many plants here. We hope they continue to invest here. They employ many workers here, so while they do owe us money because they did not carry out all of the terms of what they said they were going to do, we’re looking for an avenue where by we can encourage more investment in Ohio.”

DeWine’s comments this week follow the Ohio Tax Credit Authority’s decision Monday to shelve acting on a recommendation to seek a full refund from GM.

The matter was scheduled for consideration as late as Friday, but was removed from the agenda ahead of the meeting, not an uncommon move, according to a spokesman for the authority.

State lawmakers from the Mahoning Valley have told DeWine, according to the Republican, to try to work out a deal with GM.

“So we’re doing that,” he said. “We think it’s the right thing to do. We don’t know what that will be, but we hope it will be a win-win. A win for the people of the state of Ohio who are going to see more jobs created and a win for General Motors.”

“If we can’t get an agreement, then we can’t get an agreement,” DeWine said.“We’ll have plenty of time to go after them in regard to the money. It would be best if we could work something out and we’re going to try to do that.”

General Motors was awarded the tax credits in 2009 — $14.2 million for job creation tax credits and $46.1 million for job retention that were used to improve the facility to support production of the second-generation Chevrolet Cruze.

In exchange for the 15-year, 75 percent credits, GM agreed to keep the plant open for at least the next 30 years from then, but closed it 10 years into the agreement.

DeWine also said he is not aware of any threat by GM to scale back development in Ohio if the state moves ahead on requiring the company to repay the money.

No such threat either appears to be coming from GM, which in a statement highlighted its commitment to Ohio through more than $3.3 billion in investments since 2009, not including the $2.3 billion electric vehicle battery-cell plant under construction in Lordstown.

“We recognize our mutual obligation,” said Lt. Gov. Jon Husted. “They have an obligation to the taxpayers of the State of Ohio and we have an obligation to them as well. At the same time, we want them to be successful, we want GM to have a successful partnership with the State of Ohio and more so to continue to create jobs for the people of the State of Ohio and that constructive dialog is ongoing.”

Attorney General Dave Yost, also a Republican, argues GM should be on the hook for the full amount as a matter of accountability.

GM argues it should be spared from repayment and has asked the state to “give consideration to our significant manufacturing presence” in the Mahoning Valley and Ohio when making decisions related to tax credit agreements, according to Flores.

The tax credit authority next meets Sept. 28. Its unknown if the tax incentive matter and a request by GM for another credit for the battery-cell plant will be addressed. The latter was also removed from this week’s meeting agenda.

NEWSLETTER

Today's breaking news and more in your inbox

I'm interested in (please check all that apply)
Are you a paying subscriber to the newspaper? *

COMMENTS

Starting at $4.62/week.

Subscribe Today