Whitmer vetoes legislation that would create tax breaks for Meijer distribution

Beth LeBlanc
The Detroit News

Gov. Gretchen Whitmer nixed two bills Monday that would have created a tax break for automated equipment at a Lansing-area Meijer distribution site. 

The governor did not sign the legislation within 14 days of it being delivered to her desk, forcing an effective "pocket veto" between the end of the legislative session in December and the start of the new session Jan. 13.

A third related bill was tie-barred to one of the two vetoed but was never presented to the governor.

The pocket veto came the same day she vetoed legislation that would have allowed for the expungement of first-time drugged or drunken driving offenses.

Whitmer also pocket vetoed separate bills that would allow for a deferral of summer tax payments for people and businesses impacted by the COVID-19 pandemic, pandemic closures or flooding in the Midland area. The legislation required the state Treasury Department to spot local municipalities money as they awaited the deferred tax revenue.

"The governor let several lame duck bills expire without her signature," Whitmer spokeswoman Tiffany Brown said. "The reasons vary, including a failure to negotiate the bills, disagreement on the underlying policy or the complexity of the subject matter and the need for further discussion."

The Meijer bills would have changed Michigan tax law to exempt from sales, use and property taxes automated consumer goods handling systems that sort and recombine products into pallets for storage at distribution sites and eventual shipment to stores. 

Gov. Gretchen Whitmer nixed legislation Monday that would have created a tax break for automated equipment at a Lansing-area Meijer distribution site.

Meijer is the only facility in the state with the type of machinery to fall under the proposed tax exemption. The company expected the legislation to have an immediate effect at its Delta Township distribution facility where the company is planning a multimillion-dollar expansion. 

Meijer said the legislation would give the company parity with other Michigan businesses that have similar tax incentives. 

The state Department of Treasury and some school and municipal groups were opposed to the plan. Schools and municipal groups said they would lose tax growth from the development of the facility and future tax revenue when equipment is eventually replaced. 

Roughly 73% of sales and use tax revenue in the state goes to the school aid fund. Similar tax cuts have added up over the last several years to a more than $200 million annual loss to the school aid fund, the Michigan Association of School Boards said.