About this programme
The Michigan Business Development Program (MBDP) is a deal-closing tool created under Chapter 8A of the Michigan Strategic Fund Act (Act 270 of 1984, Section 125.2088r). It is administered by the Michigan Economic Development Corporation (MEDC) on behalf of the Michigan Strategic Fund (MSF), and it exists to provide grants, loans, or other economic assistance to businesses for highly competitive projects in Michigan that create jobs and/or make qualified investment toward a net-positive return to the state.
The programme is built for companies with near-term cash needs tied to a new, relocation, or expansion opportunity, and its stated purpose is to ensure those opportunities land in Michigan rather than elsewhere. MEDC frames it as supporting the state's broader goals of economic diversification, capital investment, stronger career pathways, and qualified new job creation.
MBDP support is not automatic or formulaic: every project is evaluated against a mix of statutory eligibility criteria and a long list of discretionary considerations (industry fit, local government commitment, wage quality, financial need, and more), and the eventual funding structure and amount are negotiated per project rather than drawn from a published schedule.
The current guidelines have been in effect for all MBDP incentives approved by the MSF since April 1, 2021.
How it works
MSF support for a project is structured as a grant, a direct loan, or other economic assistance, and cannot exceed $10,000,000 per project. All awards are performance-based.
Loans under MBDP can carry flexible terms acceptable to the MSF, including below-market interest rates, extended grace and repayment provisions, forgivable terms, convertible notes, and either no security or subordinated security. 'Other economic assistance' can include structures such as MSF participation to enhance loans made by other lenders.
Every final written agreement must include provisions requiring repayment of grant funds if certain default events occur — including eliminating the qualified new jobs committed to, or failing to meet an agreed milestone. Disbursement is tied to performance-based milestones set out in the agreement, not paid upfront.
The MEDC runs due diligence and compliance processes on behalf of the MSF, including pre-closing background checks. Applicants must be in compliance with labor, employment, and environmental laws and regulations, and the programme may require applicants to pay reasonable application fees and other administration expenses to MEDC.
Who can apply
Any 'Qualified Business' can apply — defined as a business that demonstrates to the MSF that it is located in, will locate to, operates in, or will operate in Michigan. The MSF can determine that an application covers more than one business.
Four statutory criteria are evaluated for every project: the municipality where the project sits makes a staff, financial, or economic commitment to the project (as determined by the MSF); the business provides a business plan or otherwise demonstrates the need for the grant, loan, or assistance; the business agrees to provide data MEDC needs to report to the state legislature; and whether the project results in qualified investment, qualified new jobs, or both.
If qualifying on job creation, a project must fit one of four categories. Standard: commit to creating 50 qualified new jobs. Rural: commit to 25 qualified new jobs, with the project located in a rural county with a population of 90,000 or less. Innovation: commit to 25 qualified new jobs, with the project in one of 32 NAICS-coded 'innovation industries' (e.g. pharmaceuticals, software publishers, aerospace products, semiconductors, computer systems design, scientific R&D). Micro: a job-creation number acceptable to the MSF, provided the business is in an MEDC Strategic Focus or Regional Impact industry, or the project sits in a Geographically Disadvantaged Area, or the project is in a city/township/village with under 15,000 population (or 25,000+ with above-average unemployment).
A qualified new job must be a new full-time job (35+ hours/week) held by a Michigan resident whose state income taxes are withheld, or by a non-resident at a Michigan project location where at least 75% of that business's employees are certified as Michigan residents at the time of disbursement. The job must be in addition to jobs the business already maintained in Michigan before the project, and cannot be created by transferring a job between affiliates or from an asset acquisition of a business already operating in Michigan.
Beyond the statutory bar, MEDC weighs a long list of discretionary project considerations: fit with MEDC's Strategic Focus industries (mobility/automotive, medical device technology, engineering/design/development, technology, advanced manufacturing, professional/corporate services) or Regional Impact industries (agribusiness, tourism, logistics, financial services, other manufacturing); whether the business is retail (a negative factor); location in a Geographically Disadvantaged Area, SBA HubZone, or Opportunity Zone; wage levels relative to industry and region, including 'Pathway Jobs' (targeted or promising wage tiers); financial viability; whether other locations are genuinely under consideration; and the business's track record on other MSF incentives over the prior five years.
How to apply
- Initial contact is made with the local economic development office or the applicable MEDC business development manager — there is no cold online-only application entry point.
- The applicant provides initial intake documentation for MEDC to screen the project.
- MEDC reviews the project against the statutory criteria and the discretionary project considerations (industry fit, local support, job quality, financial need, etc.).
- MEDC provides an indication of support where appropriate.
- The applicant then provides a completed application with additional supporting documents.
- MEDC completes its review and, if appropriate, issues a proposed term sheet to the business.
- MEDC prepares a recommendation to the MSF Board (or its authorized delegates) for project approval.
- After due diligence is satisfactorily completed, MEDC drafts the legal agreement for execution.
- The applicant then works through the performance-based milestones set in the MSF agreement, including the milestones tied to fund disbursement following compliance verification.
- The applicant completes required periodic reporting, and MEDC carries out compliance verification — including final headcount verification — at project closeout.
Documents you’ll typically need
- Initial intake documentation (submitted before a full application is invited)
- A business plan or other documentation demonstrating the need for the grant, loan, or assistance
- Completed MBDP application with supporting documents (once MEDC indicates support)
- Evidence of the local municipality's staff, financial, or economic commitment to the project
- Data required for MEDC's legislative reporting, per the written agreement
Frequently asked
Is the Michigan Business Development Program a grant or a loan?
It can be either, or another form of economic assistance — the MSF Act lets the MSF structure support as a grant, a direct loan, or an alternative form of assistance (such as participating alongside another lender's loan). The instrument and terms are negotiated per project, capped at $10,000,000 total support.
How many jobs does a company need to create to qualify?
It depends on the category. Standard track requires committing to 50 qualified new jobs. Rural track (county population 90,000 or less) and Innovation track (project in one of 32 listed NAICS innovation industries) both require 25 qualified new jobs. Micro track has no fixed number — it requires a job commitment acceptable to the MSF, but the business or location must instead meet criteria like being in a Strategic Focus/Regional Impact industry or a Geographically Disadvantaged Area.
Is there a maximum MBDP award?
Yes — MSF support for a single project cannot exceed $10,000,000, and all awards are performance-based rather than paid as a lump sum upfront.
Does the local municipality have to contribute anything?
Yes. One of the four statutory eligibility criteria is that the municipality where the project is located makes a staff, financial, or economic commitment to the project, as determined by the MSF — MBDP funding is not meant to stand alone without local buy-in.
Who administers MBDP and who approves the award?
The Michigan Economic Development Corporation (MEDC) administers the programme on behalf of the Michigan Strategic Fund (MSF), including due diligence, compliance, and background checks. Final project approval runs through the MSF Board or its authorized delegates, based on MEDC's recommendation.
Can retail businesses apply?
Not being a retail business is listed as one of MEDC's project considerations, so retail projects are disadvantaged relative to the programme's target industries (advanced manufacturing, technology, mobility, professional services, and similar sectors).
What happens if a company does not meet its job or milestone commitments?
Every final written agreement must include repayment provisions triggered by default events such as eliminating the qualified new jobs committed to, or failing to meet an agreed milestone — MBDP funds already disbursed can be clawed back.
Do out-of-state employees count toward the job requirement?
A qualified new job can be held by a non-Michigan resident working at the Michigan project location, but only if the business certifies in writing at the time of MSF disbursement that at least 75% of that business's employees are Michigan residents. Otherwise, the job must be held by a Michigan resident whose state income taxes are withheld by the employer.
Reviewed 2026-08-16. Programmes change — confirm current eligibility, amounts and deadlines on the official page before you apply. CapEasy is a private consultancy and is not affiliated with any government authority.