General Motors violated the terms of two Ohio state economic development agreements when it closed down the Lordstown Assembly last year. As a result, the state can require that GM repay the $60.3 million worth of tax breaks it was handed under the agreement – but it turns out that Ohio has a different plan for GM.
According to the Herald Star, GM and Ohio may be in talks about potentially waving the $60.3 million – so long as the Detroit-based automaker commits to making further investments in the state.
“They have many plants here. We hope they continue to invest here,” Ohio governor Mike DeWine said this week. “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.”
Earlier this week, the Ohio Tax Credit Authority tossed out a recommendation seeking full repayment of the tax incentives from GM. The state now plans to work closely with GM to secure further investment, though it’s not entirely clear what kind of operations or facilities may in the cards for Ohio.
We think it’s the right thing to do,” DeWine also said. “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.”
That said, if the two can’t come to an agreement, Ohio can still go after GM for the money.
“If we can’t get an agreement, then we can’t get an agreement,” he added. “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.”
The Herald Star reports GM was first awarded the tax credits in 2009, receiving $14.2 million in exchange for job creation at the Lordstown Assembly plant and another $46.1 million for job retention. GM laid off 4,500 workers when it closed Lordstown Assembly and canned the Chevrolet Cruze compact car.
GM has also made other recent investments in Ohio, namely a large new battery plant it is currently building in conjunction with its supplier, LG Chem.