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HB 5165

State management: other; denial of certain state economic development incentives for businesses listed on the registry; provide for. Amends 1984 PA 270 (MCL 125.2001 - 125.2094) by adding sec. 15.

2023-2024 Regular Session Introduced by Abraham Aiyash and 18 co-sponsors

HB 5165 would require MSF agreements to include event-of-default and clawback provisions if a recipient lists on the call-center relocation registry, tied to HB 5164; vetoed.

vetoed by the Governor 01/17/2025
#statemanagement:funds
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WeVote Research Nonpartisan
Bill Summary · HB 5165

HB 5165 — Summary: Amend Michigan Strategic Fund Act to add call-center clawback provision (Vetoed)

Purpose / Intent

HB 5165 would have amended the Michigan Strategic Fund Act (1984 PA 270; MCL 125.2001–125.2094) by adding a new section (Sec. 15) requiring that Michigan Strategic Fund (MSF) written agreements include an event-of-default and clawback provision if a funding recipient becomes listed on the call-center relocation registry created by the companion bill (HB 5164, the “Call Center Jobs Retention Act”). The bill’s goal was to disincentivize companies from relocating call-center jobs overseas by making MSF-funded businesses subject to repayment or other remedies if they later list on the relocation registry.

Key provisions

  • Adds Sec. 15 to the Michigan Strategic Fund Act (proposed MCL 125.2015).
  • Substantive requirement (in enrolled text): “Beginning April 1, 2025, the fund shall include in its written agreements provisions for an event of default and clawback of funds for a recipient … if the recipient reports a new listing on the registry described in section 7 of the Call Center Jobs Retention Act during the term of the agreement.”
  • Tie-bar: the act would not take effect unless HB 5164 (which creates the registry and notification/fine regime for employers relocating call centers abroad) is also enacted.
  • Enacting provisions: the bill also contains a standard effective-date clause (act to take effect 90 days after enactment) and the tie-bar to HB 5164.

Who would be affected

  • MSF and recipients of MSF assistance (loans, grants, tax/incentive agreements): agreements would need clawback/default language tied to the registry listing.
  • Call centers subject to HB 5164’s registry (HB 5164 impacts employers with ≥50 call-center employees and sets notice requirements, reporting, and civil fines up to $10,000 for failing to notify before relocating).
  • Department of Labor and Economic Opportunity (LEO) and MSF administrative staff (recordkeeping, contract revisions, web postings).

Fiscal and practical impact

  • Estimated to increase administrative costs to LEO and MSF (staffing/IT) but likely minimal.
  • Potential for MSF to claw back funds from recipients who relocate and are listed on the registry — amount unknown and dependent on future events.
  • No direct fiscal impact on local governments identified.

Legislative status and timeline

  • Introduced: Oct 17, 2023 (House); substitute (H-1) adopted and passed by the House Nov 13, 2024; passed the Senate and enrolled Dec 23, 2024.
  • Presented to Governor: Jan 8, 2025.
  • Vetoed by Governor Whitmer: Jan 17, 2025 — bill did not become law.

Support and opposition

  • Supporters: Communications Workers of America, Michigan AFL-CIO, Utility Workers Union of America.
  • Opponents/concerns: Michigan Chamber of Commerce, Michigan Manufacturers Association — concerns about market restrictions and trade law implications.

Governor’s veto rationale

Governor Whitmer’s veto message argued the bill was unnecessary because the federal WARN Act already requires advance notice of closures/layoffs for many employers and that the proposal would divert LEO resources to duplicate federal functions.

Compiled from official sources — confirm details with the bill’s official record.

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