Reps. Hammoud and Camilleri Propose MSF Funds Should Only Go Toward Business Growth
LANSING — State Rep. Abdullah Hammoud (D-Dearborn) introduced bipartisan legislation today to amend the Michigan Strategic Fund Act to limit CEO pay for businesses receiving tax dollars through the fund. State Rep. Darrin Camilleri (D-Brownstown Township) is a co-sponsor of the bill, House Bill 5896.
Specifically, this proposal would require businesses that are receiving funding from the Michigan Strategic Fund to limit their executive’s compensation to not exceed 100 times that of their lowest paid, full-time employee.
“Corporations that are receiving public money need to be held accountable,” said Hammoud. “If a corporation is asking the state for financial assistance, they should be utilizing that money to re-invest in their business, and to create better-paying jobs — not to line the pockets of their CEO. Additionally, this proposal would encourage higher pay for the lowest-paid employees in corporations that are receiving public tax dollars under this fund.”
Under the formula the bill presents, having a full-time (40 hours/week) minimum wage employee ($9.25/hour) would allow for a maximum executive salary of $1.9 million a year. This maximum salary would increase as the rate for the lowest-paid employee increases.
According to the Economic Policy Institute, in 2016, CEOs in America’s largest firms were compensated an average of $15.6 million, which is 271 times the annual average pay of the typical worker.
“Working families across Michigan are struggling to pay for things like college tuition, childcare and car repairs,” Camilleri said. “At a time when wages have been stagnant for over a decade, our public dollars should be used to grow the middle class and pay people a living wage, not to subsidize the salaries of CEOs. It’s time to stand up as a state, end handouts to corporate executives and demand a system that helps working families build a better life here in Michigan.”
“Some members of the Michigan Legislature continue to target our most vulnerable residents rather than those actually abusing the system,” said Hammoud. “This bill proposal seeks to solve an actual problem — stagnant wages and corporate CEOs that make millions while asking the state for tax breaks.”