Bill > HB5413

This bill establishes the Corporate Welfare Prohibition Compact, an interstate agreement designed to prevent state governments from providing selective subsidies to specific businesses or industries. The compact is based on the understanding that offering targeted economic incentives to lure companies between states is ultimately harmful to the national economy, creates inefficient resource distribution, and can contribute to political corruption. Under the compact, state governments and their political subdivisions would be prohibited from providing subsidies to private enterprises intended to encourage a specific company or industry to relocate or establish a new facility. The compact becomes fully active when states representing a three-fifths majority in both U.S. Congressional houses join, at which point member states must cease providing new subsidies beyond existing contractual obligations. The bill defines "subsidies" broadly, including direct grants, tax considerations, and other economic benefits, while explicitly excluding general infrastructure improvements, essential government functions, and uniform tax or regulatory reductions. The compact includes provisions for enforcement by each state's chief law enforcement officer, allows taxpaying residents to require enforcement, and establishes a mechanism for state governors to administer and track participation. States can join the compact by enacting legislation, and once the three-fifths congressional threshold is met, withdrawal is prohibited.

Government Affairs

https://legislature.mi.gov/Bills/Bill?ObjectName=2025-HB-5413