MEDC Announces Haworth's Expansion in Holland, Resulting in 609 New Jobs for State

Contact: John Truscott (517) 335-6397

Governor John Engler announced today that the Michigan Economic Development Corporation's (MEDC) incentives package has helped bring Haworth's new expansion to Holland. The MEDC helped win the project by making a competitive business case, against Tennessee, for the company to expand in Michigan with a Single Business Tax credit, an abatement of the State Education Tax and job training assistance.

Haworth, Inc. plans to expand its administrative offices in Holland — the city where the company was founded and headquartered — rather than at its Nashville facility. It is estimated that this expansion will create 609 new jobs, 455 directly by the company, for Michigan workers.

"Since 1948, Haworth has had a strong and positive presence in Michigan. As the company has grown and prospered during the years, so has the state of Michigan," Engler said. "This new expansion is another example of our mutually-beneficial and positive partnership."

This new Haworth facility is designed to support continued business growth. Haworth plans to invest more than $17 million investment in the building and equipment.

"We viewed this project as critical to the economic outlook of Holland," said Chris Byrnes, president of the Holland Economic Development Corporation. "Keeping Haworth's headquarters (more) firmly entrenched in Holland is a tremendous success for the region."

Of the new jobs, 154 spin-off jobs will be created from increased spending by people who receive income from the jobs at Haworth, according to an economic analysis completed by the University of Michigan.

A key feature of the MEDC incentives package is a Michigan Economic Growth Authority (MEGA) tax credit, approved today by the MEGA board, worth an estimated $9 million during the next 20 years. MEGA, which is administered by the MEDC, is used to promote high quality economic growth, job creation and retention in Michigan.

In addition, the incentives package includes an abatement of the six-mill State Education Tax for 12 years with a value estimated at $628,000 and job training a ssistance valued at $227,500 to train the new employees at Haworth's expanded facility.

This project will provide more than $58.3 million in revenue to the state over the life of the agreement, resulting in a net positive gain for the state of more than $49.2 million, after the MEGA credit. The project is expected to generate more than $729 million in personal income during that time.

"Haworth is a global company with aggressive growth plans," said Jerry Johanneson, Haworth president and chief executive. "We are pleased that our home state continues to support our growth."

Haworth is the world's second largest designer, manufacturer and marketer of office furniture and seating, with 1999 sales of $1.58 billion. Based in Holland, Haworth operates in more than 120 countries worldwide and employs approximately 14,000 members.

The Michigan Economic Development Corporation works in partnership with local communities and Michigan businesses to retain and expand job opportunities and improve Michigan's overall business climate. For more information, on the Michigan Economic Development Corporation's initiatives and programs, visit the website at www.michigan.org.

Haworth, Inc.
MEGA Analysis
Summary Estimated
(All estimates in 2000 dollars)

TOTAL JOBS CREATED
609
Direct
455
Indirect
154
NET POSITIVE STATE REVENUE IMPACT
$49,290,000
Revenue Foregone
$9,091,000
Revenue Gain
$58,381,000
Average Wage
$800/week
Personal Income Generated Over Life of MEGA Agreement 
$729,731,000


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