Bill
HB 4241
HB 4241 bars the Michigan Strategic Fund from granting economic incentives to foreign entities tied to listed governments, requires affidavits, and imposes perjury penalties.
Status and sponsors
- Introduced March 13, 2025 by Rep. Mike Hoadley (original filing March 10 also noted).
- Adds section 7c to the Michigan Strategic Fund Act (1984 PA 270; MCL 125.2001–125.2094).
- Passed the House (Roll Call #87 — Yeas 66, Nays 44) on May 6, 2025; referred to the Senate Committee on Government Operations (May 13, 2025).
- Companion bills: SB 1795 and HB 4551.
Purpose
- To prohibit the Michigan Strategic Fund (MSF) and entities that receive or distribute MSF-administered economic incentives from knowingly providing incentives to, or for the benefit of, certain foreign-controlled entities associated with specified foreign countries of concern.
Key provisions
- Prohibition: MSF may not knowingly enter into an agreement for an "economic incentive" with a "foreign entity."
- Definitions:
- "Foreign country of concern": specifically lists the People’s Republic of China, Russian Federation, Iran, North Korea, Cuba, the Venezuelan regime of Nicolás Maduro, and Syria, and entities under significant control of those listed.
- "Foreign entity": one that is owned or controlled by a government of concern; organized under the laws of, or has principal place of business in, a country of concern; or is a subsidiary of such an entity.
- "Controlled by": presumption of control where a government directly or indirectly holds ≥25% voting interest or is entitled to ≥25% of profits.
- "Economic incentive": broadly includes all MSF‑administered programs or programs requiring MSF certification/approval — e.g., grants, loans, other assistance.
- Affidavit requirement: Before awarding any economic incentive, MSF must require an applicant/recipient to submit an affidavit, under penalty of perjury, attesting they are not a foreign entity (form/manner prescribed by MSF).
- Downstream obligations: Any person (including government entities) that distributes or receives an economic incentive must not knowingly distribute it to or use it for the benefit of a foreign entity, must obtain the same affidavit from downstream recipients, and must forward affidavits to MSF.
- Rulemaking: MSF must promulgate rules under the Administrative Procedures Act to implement the section.
- Penalty note: Perjury on the affidavit would be a felony (up to 15 years), as noted in accompanying fiscal analysis.
Who is affected
- MSF and all applicants for MSF-administered economic incentives.
- Intermediary distributors and recipients of incentives (local units of government, development corporations, public/private entities, colleges/universities, lenders, etc.).
- Entities owned/controlled by, organized in, or with principal operations in the listed countries, and subsidiaries or joint ventures with material ownership/ control by such entities.
Fiscal and practical impacts
- House Fiscal Agency: no direct fiscal impact to MSF; minimal administrative costs for compliance and rulemaking expected.
- Indeterminate state/local fiscal impacts possible related to enforcement and potential criminal prosecutions; HFA notes incarceration and supervision cost metrics as context for perjury enforcement costs.
Effect
- Establishes a statutory vetting and prohibition regime intended to prevent state economic incentives from benefiting entities tied to specified foreign governments.
Compiled from official sources — confirm details with the bill’s official record.
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