Dow and Midland: It's just good chemistry

Midland’s key ingredient to its long-term economic success can be summed up in one word: Dow.

The Dow Chemical Co. has had an outsized impact on this handsome, prosperous mid-Michigan community of about 42,000 since Canadian immigrant Herbert Henry Dow arrived in 1890 and started manufacturing bleach.

Dow Chemical’s influence can be seen throughout the community at places such as the H Hotel, Dow Diamond (home to the minor league Great Lakes Loons baseball team) and the Grace A. Dow Memorial Library (named for Herbert’s wife)—all made possible because of contributions by Dow Chemical and the company’s charitable foundation.

Herbert Dow also created Dow Gardens, a 110-acre horticultural gem in the city. Noted architect Alden Dow, Herbert Dow’s youngest son, performed much of the design work.

“The people of the Great Lakes Bay Region have contributed greatly to Dow’s success over the past 115 years," said Rich Wells, vice president and site director of Michigan Operations for Dow. "We recognize the importance of giving back, not only through our role as a major employer, but also as an active corporate citizen.  Our more than 6,000 employees have a vested interest in the success of this community because it is more than just their workplace – they live here and raise their families here."

Dow is by far Midland’s largest employer. Its work force includes many highly paid chemists, researchers and engineers with advanced degrees.

That’s a key reason for the city’s 6.2 percent unemployment rate in July, nearly three percentage points lower than the state average.

Midland’s median family income in 2010 was $67,010, well above the state average of $60,341, according to census data.

"The economic environment of the city has traditionally remained steady, despite the many financial challenges that the state of Michigan and neighboring communities face," city officials wrote in Midland’s 2011 audit report.

Property owned Midland by Dow Chemical and subsidiary Dow Agrosciences has a taxable value this year of $384,774,133, or 17.5 percent of the city’s total value.

Dow’s city tax bill this year is $5.2 million, said City Manager Jon Lynch.

A related company, Dow Corning Corp., is the city’s third largest employer with 1,350 workers, according to Midland Tomorrow, a local economic development agency.

The company was formed by Dow Chemical and Corning Glass Works in 1943 to manufacture silicones, lubricants and specialty chemicals.

The Midland Cogeneration Venture, which supplies electric power to Dow Chemical, is the city’s second-largest taxpayer with property valued at $224.6 million. Dow was once a partner with Consumers Energy in the company.

Dow Chemical -- with its various subsidiaries -- Dow Corning and the Midland Cogeneration Venture comprise 40 percent of the city’s tax base, according to Midland’s 2011 audit.

Scott Walker, president of Midland Tomorrow, a local economic development agency, said via email: "The Dow Chemical Company and Dow Corning Corporation provide the backbone of Midland’s chemical and materials based economy. The energy that is created by having Dow and Dow Corning operate their corporate headquarters, research and development, and large manufacturing facilities in the Great Lakes Bay Region is readily leveraged by other successful firms."

The chemistry between Dow Chemical and Midland hasn’t always been positive, despite the pronounced economic benefits the city and its residents derive from the company.

Dow Chemical and the city were engaged in a nine-year long dispute, starting in 1997, over the value of the company’s property holdings. It was settled in 2006 with the city and state refunding $35.1 million in tax payments to Dow.

Rick Haglund has had a distinguished career covering Michigan business, economics and government at newspapers throughout the state. Most recently, at Booth Newspapers he wrote a statewide business column and was one of only three such columnists in Michigan. He also covered the auto industry and Michigan’s economy extensively.