Lansing looks to lure biopharmaceutical company to DeWitt Township

City Council weighs Act 425 agreement for would-be manufacturing development

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WEDNESDAY, April 28 — The city of Lansing is trying to entice a biopharmaceutical company to build a large manufacturing facility near the Capital Region International Airport. And now the City Council is leaning on a partnership with Dewitt Township to help put the plans into motion.

An Act 425 agreement introduced at this week’s City Council meeting would allow for the city to essentially adopt a 34-acre parcel of land in Dewitt Township, “enabling the framework” for Emergent BioSolutions to build a 181,700-square-foot manufacturing facility on the property. 

The site — which is mostly just vacant, grassy fields —  is located on the southwest corner of S. Dewitt and Port Lansing roads, just past the north end of N. Martin Luther King Jr. Boulevard.

“Emergent BioSolutions is considering locations for prospective business expansion, and a specific site in the Lansing region of Michigan is an attractive option,” according to a memorandum attached to a draft agreement included in this week’s City Council materials.  

The idea: Emergent would begin constructing a “production facility” as early as this summer that will eventually employ an estimated 328 employees, according to a site plan submitted last month to Dewitt Township. The proposal also includes the construction of a 4,000-square-foot café, a 1,500-square-foot maintenance building, parking lots and landscaping improvements.

In turn, the city would handle zoning, sewer, police and fire services. The township would handle code and building inspections. The Lansing Board of Water & Light would power it all. The income and property tax revenues from any development on the site — which is currently owned by Emergent BioSolutions — would be split between them equally for the next 50 years. 

Bob Trezise, president and CEO of the Lansing Economic Area Partnership billed the maneuver as a win-win for both municipalities, noting it could enable the region to compete for a major development that would otherwise be impossible without the Act 425 agreement in place. 

He declined to name Emergent BioSolutions as the would-be developer, but also said he wasn’t aware of any other companies or corporations interested in developing that particular property.

The memorandum notes that the agreement would act as a “foundational and enabling framework only for Emergent to assess future growth opportunities.” It also references a site plan for a 180,000 square foot industrial building from Emergent BioSolutions that also “would need” tax incentives and tax abatements before the construction plans could come to fruition.

Mayor Andy Schor wouldn’t confirm or deny any details about the would-be development project. Calls and emails to Emergent BioSolutions were not returned for this story. Trezise told the Council to expect further details about the potential construction project by late June.

The Council set a public hearing for the Act 425 agreement for May 10, which could line it up for formal approval as early as June 21. Dewitt Township is considering an identical agreement.

Act 425 agreements create a temporary transfer of jurisdiction, often just short of annexation. They also enable a broader net of tax incentives and grant the city of Lansing the ability to actually collect taxes from the project, which would otherwise be entirely in Dewitt Township. In return, the city would have oversight on infrastructure, sewer lines and other utility connections. It would also be responsible for providing zoning and emergency services to the property. 

The proposed agreement contemplates the proposal as “an important step to enable infrastructure support and financing tools to make any future project assessment feasible and an attractive option to choose the Lansing, Michigan location over out-of-state options.”

Any actual tax incentives or abatements would require further approval from the City Council.

The agreement would also only cover a single 34-acre parcel of land at the southwest corner of S. Dewitt and Port Lansing roads near the Capital Region International Airport. Most of the land — bordered by the Reserve Forces Support Center to the south — is currently a vacant field.

“Additional details would be provided by Emergent and LEAP if prospective project plans are finalized, and decisions made to move forward,” according to materials originally included with the City Council packet. “If a project does not materialize on this site in the coming years for any reason, the 425 Agreement will be nullified, and the property revert fully to DeWitt Township.”

The stock price of Emergent BioSolutions has fallen sharply since the disclosure at the end of March that production problems at the firm’s plant in Baltimore had ruined 15 million doses of Johnson & Johnson’s coronavirus vaccine, according to reports in the Washington Post

Councilman Brandon Betz voiced concern over Emergent’s reputation at this week’s meeting.

He asked: “Is this the same Emergent BioSolutions that ruined the 15 million doses of the Johnson & Johnson vaccine? Is it going to be similar to the one in Baltimore? What hazards and risks does the community face when it comes to the operations that will be done at this plant?”

Trezise quickly deflected: “There will be a time and place to have all those questions answered.”

Emergent’s stock price has plunged since mid-February from about $125 a share to $62. Since then, AstraZeneca has reportedly moved production of its own vaccine out of the Baltimore facility and Emergent temporarily halted new production there altogether. Security filings also showed that Emergent’s chief executive, Robert Kramer, sold more than $10 million worth of his stock in the company in January and early February, the Washington Post reported this week. 

Company officials previously told City Pulse that Emergent’s existing facilities in Lansing haven’t been involved in the production of COVID-19 vaccines. Instead, they primarily focus on anthrax vaccines in the Capital City. What could be manufactured in Dewitt Township remains unclear.

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