Whirlpool Staying in Michigan

By PlanetLaundry staff | Jul 21, 2010

Whirlpool Corp. has received a state tax incentive for consolidation of its headquarters in southwestern Michigan.

The $86.8 million project is expected to help the company retain nearly 870 jobs while transforming a Benton Harbor, Mich., site that now includes an abandoned car dealership and shuttered storefronts, according to an Associated Press report.

It's no doubt welcome news in a city of 10,800 that has long been considered one of Michigan's most economically distressed areas. The city has lost approximately 15 percent of its population since 1990 and has been run with the help of a state-appointed emergency financial manager since April.

"We have a commitment to Michigan," Whirlpool Corporate Vice President Jeff Noel said at a news conference shortly before the tax credits were approved. "Michigan has a commitment to us. And we think it's the right decision, long-term."

Michigan officials said Benton Harbor was competing with sites in Illinois and Georgia for the Whirlpool investment.

The company will consolidate its 15 owned and leased facilities in the Benton Harbor area into three centralized office campuses.

The three campuses will include the existing Benton Harbor Administrative Center and St. Joseph Technology Center locations, as well as a new three-building campus to be located near Benton Harbor’s downtown riverfront area.

"With more than 4,000 individuals in our current facilities, we have simply outgrown our current space communities," said Whirlpool Chairman and CEO Jeff M. Fettig. "This initiative is a good business decision as the new campus and related changes are expected to increase productivity and energy efficiency, and reduce operating costs."

The Michigan Economic Growth Authority board has approved a tax credit worth more than $19 million over five years for Whirlpool. Local governments also are considering incentives packages for the project.

Although Michigan's tax incentive policies have drawn some criticism, Gov. Jennifer Granholm defended those policies while announcing grants for Whirlpool and several other companies.

Clearly, the state is hungry for new investment because its unemployment rate, 13.2 percent in June, has been among the highest in the nation for the past several years.

"Those who say we should not be going after these companies with tax incentives would have us unilaterally disarm," Granholm said.
“These companies would not be choosing Michigan if we didn't have the economic tools to make a good business case for them. Every state is competing.”

In a related item, Whirlpool’s second-quarter net income more than doubled as the company cut costs and benefited from consumers taking advantage of federal rebates to buy appliances.