GM Gets Tax Break To Stay In Detroit

Automaker is promising to keep its headquarters in Detroit in return for expanded state tax credits approved Tuesday.

LANSING, Mich. (AP) -- General Motors Co. is promising to keep its headquarters in Detroit in return for expanded state tax credits approved Tuesday.

The Michigan Economic Growth Authority gave the go-ahead to extend tax credits the company won in June for agreeing to build a new small car at its Orion Township plant near Pontiac. The tax credits now cover some workers at GM's Renaissance Center headquarters in downtown Detroit.

The new agreement says GM must keep 22,500 employees in the state rather than just 20,000 to get the tax credits, including around 2,500 in the Renaissance Center. About 4,000 GM employees work there now, GM spokesman Greg Martin said.

How many employees will remain in Detroit will be worked out with state economic development officials over the next month. But Martin says the automaker is committed to keeping its headquarters in the Motor City.

"We understand how important it is to maintain a presence in Detroit," he said.

Gov. Jennifer Granholm echoed that sentiment during a Tuesday news conference in Lansing.

"From a symbolic and a real perspective, it is incredibly important," she told reporters. "The city, obviously, benefits enormously from having those employees there in the Renaissance Center. It's iconic. It's a symbol. For it to abandon Detroit would send a terrible message."

Martin said GM is looking at moving some Renaissance Center employees to other GM sites as it realigns its shrunken staff.

It's likely some workers will be moved from Detroit to the GM Technical Center in Warren. Those workers could include marketing employees who work with the engineers and technicians designing new cars.

"Those are instances of where it makes sense to probably have those people together," Martin said.

The size of the tax credit is still being determined, but the state agreement now covers 17 GM facilities in Michigan plus the Renaissance Center.

GM bought the Renaissance Center in the mid-1990s and houses most of its corporate employees in two of the seven towers that rise beside the Detroit River and anchor downtown. It erected an earlier headquarters in Detroit in 1919.

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