Philadelphia Long Time Jeep dealer, Gary Barbera of Barbera’s on the Blvd, remembers the 1st generation Jeep Grand Cherokee. Now, Fiat Chrysler will offer more jobs next to this announcement and a new larger SUV.
JC REINDL | DETROIT FREE PRESS | 4:29 pm EDT July 23, 2019
Fiat Chrysler will convert its Mack Avenue Engine factory into an assembly plant. The plant will build the next-generation Jeep Grand Cherokee and a new, large Jeep SUV.
TANYA WILDT, DETROIT FREE PRESS
Fiat Chrysler’s plant expansions and upgrades on Detroit’s east side will get another $92.8 million worth of development subsidies at the local and state level.
On Tuesday, the Michigan Strategic Fund approved a brownfield redevelopment plan that will capture that amount of local and state taxes over 30 years and divert them to the automaker to help support its Mack Engine Plant expansion, a $1.7-billion project that is expected to create about 3,850 full-time jobs in the city.
The Mack project will involve reopening the automaker’s long-idled MACK II plant, as well as converting its MACK I plant from producing engines to assembling the next-generation Jeep Grand Cherokee, which is expected to launch in 2021.
Without the brownfield redevelopment subsidy, Fiat Chrysler wouldn’t undertake the Mack project and, instead, would put that factory capacity in Illinois or even Mexico, according to briefing documents for the Michigan Strategic Fund’s Board of Directors.
“Without incentive assistance, the company would proceed forward with the project outside of Michigan,” the briefing documents say.
The brownfield program uses tax-increment financing to reimburse costs related to redeveloping contaminated, blighted, functionally obsolete or historic properties.
Fiat Chrysler’s $92.8 million brownfield plan is not the project’s only development subsidy. In May, the Michigan Strategic Fund approved $140 million in various incentives for Fiat Chrysler to move ahead with the Mack plant project as well as upgrades at the adjacent Jefferson North Assembly Plant.
Fiat Chrysler is spending an additional $800 million to upgrade Jefferson North.
Separately, Fiat Chrysler could receive up to $37.8 million in additional local and state tax-capture subsidies for the Mack project through the Michigan Department of Environment, Great Lakes and Energy. That potential subsidy also relates to the brownfield redevelopment program.
A department spokesperson said Tuesday that the department is still reviewing Fiat Chrysler’s plans and hasn’t approved the request.