Eldridge, D’Amico Propose Tax Credit Transparency & Accountability Legislation

FOR IMMEDIATE RELEASE
June 9, 2009

BOSTON-  As Massachusetts invests hundreds of millions of dollars in economic development grants – including tax reductions, tax credits, and subsidies – to jumpstart our economy, Representative Steve D’Amico (D-Seekonk) and Senator Jamie Eldridge (D-Acton) have proposed legislation to help ensure greater transparency and accountability in the process.

The bill – H.333, “An Act Related to Economic Development & Fiscal Accountability” – will be heard today by the Joint Committee on Economic Development & Emerging Technologies today at 1pm in Rm 222 of the State House.

“Our state invests heavily in economic development each year. However, because spending is fragmented across many agencies and authorities, it is difficult to assess how much we are spending in total, or to judge the benefits,” said D’Amico. “This bill addresses both of these issues.”

“As we cut millions of dollars in funding for human services programs, we need to make sure we examine our spending in every area of government to be sure we’re spending our money as efficiently as possible, and that we’re getting a good return on our investment. How much are we spending on tax credits and subsidies, and what benefits are we receiving for that money?” added Eldridge.

The D’Amico/Eldridge bill will promote greater transparency in economic development spending by requiring uniform web reporting for all tax reductions, credits and subsidies on, among other things, the number of jobs created, employee benefits, and wages.

It also establishes some basic standards subsidy recipients must meet, with associated clawbacks, to allow the Commonwealth to recapture some of the subsidy funding if recipients aren’t meeting stated, pre-determined goals.

For example, the standards would require that wages from new jobs created through subsidies remain at or above 85% of the average wage for the industry and region, to ensure that the jobs created pay a livable wage for Massachusetts residents. The bill would also require that the state subsidy per permanent, full-time job may not exceed $35,000.

View the full text of the bill: http://www.mass.gov/legis/bills/house/186/ht00pdf/ht00333.pdf

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