House passes bill to exempt Switch from tax

Michigan

LANSING, Mich. (WOOD) — A difference of opinion over tax breaks meant to lure data storage business Switch to West Michigan has is closer to being settled but the debate continues.

News 8 first reported about the disagreement in October when the Caledonia Community Schools said the data giant owed taxes on a special assessment that the company said it was exempt from paying.

In fact, Switch operated for two years at the Pyramid building before getting a $375,000 bill earlier this year.

The company paid but immediately appealed. It ultimately resulted in a very specific piece of legislation.

On Wednesday, by a narrow margin, the House passed a Senate bill that would remove tax liability for special assessments and other taxes for a very limited category of businesses or Switch.

The vote did not come without controversy.

State Rep. Steve Marino, R-Harrison Township, supported the idea.

“They have provided more than 800 jobs in the state of Michigan — jobs that will be on the line if the state does not keep this promise. Eight hundred people and their families have benefited from these jobs, provided by Switch and this opportunity,” he told fellow lawmakers.

State Rep. Yousef Rabhi, D-Ann Arbor, was opposed to the idea of a special set aside.

“I want an explanation about how it’s fair to the many small businesses that one large operation can walk into the capitol in Lansing and stand on the tiles with their lobbyist and invest in the votes they need to pass their bill,” he said.

The bill says in part that “eligible data center property located at the site of a renaissance zone that was approved in 2016 by the Michigan Strategic Fund with a minimum investment of $100.0 million would be exempt from certain assessments and taxes.”

Only Switch would currently meet that standard.

The bill as substituted will now head back to the Senate for consideration early next year.

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