July 26, 2018

$600M economic development bill aims to correct imbalances

Photo | Courtesy
The Massachusetts State House.

As the Senate digs into its $601 million economic development bill and the 321 amendments senators have filed, the Senate's chairman of the Economic Development Committee said the bill's investments and policy sections are "really going to get at the heart of the imbalance we all feel in our economy right now."

"If you look at the overall statistics of Massachusetts, at first blush it might seem like an economic development bill isn't even necessary. The statistics paint a very rosy picture of life in Massachusetts," Sen. Eric Lesser, who co-chairs the Committee on Economic Development and Emerging Technologies, said. "But what we all know, of course, and what is especially appreciated in my communities where I come from in Western Massachusetts, is that's not the full story."

The legislation includes $50 million for grants for dredging projects in coastal communities, $50 million to the Massachusetts Cultural Facilities Fund for projects that would advance and promote tourism at cultural sites, $100 million for construction and improvements at the Raymond L. Flynn Cruiseport in South Boston to accommodate larger vessels, and $25 million for matching grants to enable colleges and universities to participate in and receive federal funding through the Manufacturing USA program.

"The idea here is to do what we can to put our thumb on the scales to rebalance the economy towards greater equality for people," Lesser said.

In total, the bill authorizes $601.45 million in state borrowing -- a smaller sum than the $666 million version (H 4732) that passed the House earlier this month. About a third of the borrowing authorized in the Senate bill, or $200 million, would be bound for the MassWorks infrastructure grant program.

MassWorks funding could be an issue as lawmakers attempt to pass the borrowing bill in the Senate and then reconcile the House and Senate versions before the end of the month. The House authorized $300 million for the popular municipal grant program.

"There is a belief that they do have runway left in the current MassWorks authorization," Lesser said. "The belief was, considering that they do have existing runway and that the $200 million will give them at least probably two years of runway moving forward, there can always be another authorization done and they can always come back for an extension but this was the fiscally prudent way to continue."

The bill also includes policy sections that would regulate the use of non-compete agreements, prohibit a person from making an assertion of patent infringement in bad faith, and establish an Innovative Communities Program to serve as an access point for education and connections for startups and municipalities seeking innovative technology solutions.

"The combination of patent troll protection, non-compete protection and the innovative communities bill ... is going to do quite a lot to signal to the residents of Massachusetts and the entrepreneurs of Massachusetts that we have their back and that Massachusetts is the place you want to start a business and a place you want to locate your start-up and is a place where you will be supported and encouraged to create jobs," Lesser said.

Two years ago, lawmakers failed in the final hours of formal sessions to reconcile non-compete bills passed by the House and Senate, and the issue has not reemerged again this session until now. Non-compete agreements between employers and employees are aimed at preventing workers from going to work for competitors.

Lesser said the language in the economic development bill mirrors that of a bill (H 4419) that was favorably reported out of the Joint Committee on Labor and Workforce Development in April and is the "same approach that the House and the speaker took."

"There is a general belief that that strikes the right balance right now and that was the right way to take on the issue," he said. "We want to try to get this done in a cooperative way for our communities."

Asked Wednesday whether the House would also adopt the non-compete language, House Speaker Robert DeLeo said the issue could be considered as part of the inevitable negotiation on a final bill.

The Senate bill as redrafted by the Ways and Means Committee does not call for a sales tax holiday this August, as the House did. Senate Minority Leader Bruce Tarr filed an amendment for the 6.25 percent state sales tax to be frozen Aug. 11 and Aug. 12 on most items that cost less than $2,500.

Lesser said the Senate wanted to give members a chance to weigh in on the idea rather than include it as part of the bill itself.

"There is a difference of opinion on the sales tax holiday and I think we wanted to have a chance to have a discussion today and have a discussion with the caucus," Lesser said.

Including the popular sales tax holiday via an amendment would give senators a chance to go on record supporting the tax-free weekend ahead of election season, but some senators in recent years have objected to the idea as a gimmick.

Asked how lawmakers plan to reconcile the differences between the House and Senate versions of the economic development bill, Lesser laughed and said, "We'll get it done. Yeah, we'll figure it out."

When asked if the Legislature might suspend its own rule against creating conference committees after July 17, Lesser said the decision is "above my head."

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