Michigan New Jobs Training Program

Under MCL 389.161 – 389.166, employers can obtain training for new employees hired for new jobs under the Michigan New Jobs Training Program. Designed as an economic development incentive, the MNJTP authorizes community colleges to issue debt on behalf of employers that are creating new jobs and/or expanding operations in Michigan for the purpose of funding a variety of training and employee development needs for those new positions. 

Eligible employers contact their community college and submit an application. Community colleges then work with employers creating new jobs to indentify training needs and calculate the needed financial support to fund training. Preliminary agreements are used to “set the clock”, lock in the date from which new employees can be counted for the project and training expenses may be reimbursed. It is preliminary in nature and either the college or the employer can decide not to proceed. Final agreements need approval by the community college board of trustees, but require no review or approval from the State. The community colleges then raise capital by either issuing debt in the form of bonds (by themselves or in a group issuance administered by the Michigan Municipal Bond Authority, or by using the colleges’ reserves or operating funds to self fund projects. It is up to each college to determine the best approach and financing mechanism to raise the training funds. Finally, the colleges administer the training funds and ensure employer needs are being met. 

Community colleges issue debt on behalf of employers. Employers then repay the debt by a diversion of withholding taxes generated by the wages earned by the new employees. Funds available through the MNJTP are dependent upon training needs and projected withholding tax revenue available to repay the debt.

Employers pay the cost of training for new employees with dollars that would otherwise have been paid to the state for withholding taxes. The MNJTP allows employers to take a credit and send those dollars to the community colleges to retire the debt funding the training program. If an employer hires the number of new employees and pays the wages it certified to the college, the program costs the employer nothing. However, should the employer not hire the number they certify, or leave Michigan before the debt is retired through normal withholding diversion, the employer would still be liable for meeting the terms of the contract (participating employers do assume the risk of repayment through a diversion of withholding taxes). 

A wide range of training can be offered, from highly specialized/customized training to basic skills instruction; MNJTP funds can be used for the following: 

• Adult basic education and job‐related instruction;
• Developmental, readiness, and remedial education;
• Vocational and skill assessment services and testing;
• Training facilities, equipment, materials, and supplies;
• Administrative expenses for the new jobs training program;
• Subcontracted services with public universities and colleges in this state, private colleges or universities, or any federal, state, or local departments or agencies; and
• Contracted or professional services.

No, OJT is not included as an allowable expense under the MNJTP.

MNJTP funds follow the positions not the individuals hired into those positions. The employer is still liable for the amount of the withholding tax diversion for the certified positions under the contract.