September 15, 2003

ROMNEY UNVEILS JOBS PACKAGE TO STRENGTHEN THE ECONOMY

Legislation includes new local aid for housing creation, tax rebates for businesses

Saying he is committed to strengthening the economy, Governor Mitt Romney today took

the next step in his campaign to create more jobs in Massachusetts with comprehensive legislation that he said will “benefit all companies and all types of workers.”

Romney said the bill “will help provide us with a resurgent, across-the-board economic recovery.”

Romney laid out the details of the jobs bill in a series of meetings with key business, labor and academic leaders, and with members of his Regional Competitiveness Councils, which are all-volunteer boards that guide economic development in different areas of the state.

The legislation – to be filed once final input is received – is focused on expanding key businesses, training workers and developing more housing and commercial space.

Among other initiatives, it includes:

• A targeted tax rebate to companies that create new jobs in biotechnology, life sciences and medical device manufacturing;

• New local aid for communities that create more housing, paid for by a sales tax rebate on building materials;

• Career assistance for workers, such as a non-degree tuition assistance loan program and grants to encourage training partnerships among community colleges, industry and career centers;

• Expansion of Statewide Technology Transfer Center at UMass to increase likelihood that technology developed at the school will have commercial application and lead to job creation;

• Doubling the Economic Opportunity Tax Credit from 5 to 10 percent for business development of brownfields; and
• Matching grants of up to $200,000 to revitalize urban centers, keeping jobs near housing and helping maintain the local tax base.

The bill has a three-year price tag of $125 million. An estimated $50 million of this amount is funded by instituting a change that conforms the state’s tax refund practices to IRS time limits. The remainder is paid for through self-funding mechanisms or non-General Fund sources.

Romney said the bill “addresses a number of systemic problems – such as housing and urban decline – that have undercut previous job creation efforts in Massachusetts,” and he credited the public, private and nonprofit leaders serving on the Regional Competitiveness Councils with many of the innovative features being proposed as part of the legislation.

The Governor noted the bill builds on the Commonwealth’s strengths by providing incentives to move jobs from the laboratory to manufacturing facilities.

Under the proposed tax rebate, eligible manufacturing companies in the biotech, life sciences and medical devices field that create at least 25 new jobs will be entitled to a rebate equal to 50 percent of the state income tax paid to the state for each new employee of the company.

“If you create a product here, we want you to make that product here,” Romney said.

And he said the lack of housing, cited as the number one barrier to business growth in Massachusetts, will finally be addressed head-on with incentives to communities that increase their number of housing units.

In addition to new local aid to reward housing starts, Romney proposes freeing up state-owned surplus property for residential use by offering communities a share of the sales price of the land if they take “housing friendly” action, such as zoning changes, that pave the way for development.

Lieutenant Governor Kerry Healey introduced a manager at the New Balance Athletic Shoe Company, Kevin Watts, to highlight the type of career assistance that will see an expansion under the bill.

“As a manager, Kevin was able to learn about lean manufacturing techniques. Lean theory is designed to cut down on waste and increase efficiency. This training has created a better manufacturing process that will preserve jobs right here in Massachusetts,” Healey said.

According to Healey, the bill targets a gap in tuition assistance by making it available to individuals who do not want to embark on a college degree program, but need specific education or training that will allow them to re-enter or advance in the workplace.

She also hailed the grant program supporting training partnerships between community colleges, industry groups and the state’s career centers, saying it will match the needs of growing businesses with job seekers.

Earlier this year, Romney launched his “Jobs First” campaign, which consisted of a number of initiatives aimed at job growth and economic development. Among the steps taken were:

• Creation of Regional Competitiveness Councils;
• The establishment of a New Markets Tax Credits Connection, a clearinghouse of information to help eligible communities apply for federal grants;
• The launch of a business leader survey;
• The announcement of workforce training fund grants to 70 businesses across the state;
• A series of jobs forums hosted by the Governor around the state;
• A “Jobs First” day at the state’s 32 Career Centers, which showcased their services and newly-expanded hours;
• Created the Entrepreneurial Spirit Award and the Inner City Investment Award to recognize the contributions of businesspeople and the companies they lead.

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ROMNEY “JOBS FIRST” PROPOSAL

Governor Romney’s “Jobs First” proposal has several components to help stimulate job creation in Massachusetts and get our unemployed workers jobs. The Administration has spent months meeting with different groups across the state – corporations, small businesses, labor unions, industry councils, regional groups, chambers of commerce and citizens at large – to find out what they need to create new jobs and prepare our workforce for those jobs. Based on this input, we have developed a comprehensive plan. The components of the plan include:

1. EXPANDING KEY BUSINESSES

The Romney “Jobs First” plan spurs new and existing businesses to increase the number of jobs and investment in Massachusetts. This includes growing our emerging technologies, which are potentially the future engine of our economy.

Targeted tax rebate for new manufacturing jobs. Of the 160,000 jobs lost in this recession, over 50 percent (82,000) were in the manufacturing sector. This program will reduce the cost to relocate or expand manufacturing in Massachusetts by providing a rebate of 50 percent of the state income tax withheld for new jobs created. This rebate will be piloted for biotechnology, life sciences and medical device manufacturing. (3-year value: $10M)

Make the Investment Tax Credit permanent.

Regional Business Support. To successfully grow jobs in each of the regions, we need a dedicated regional staff to actively drive job creation by proactively selling each region’s competitive advantages to employers looking to relocate, expand or sustain jobs in Massachusetts. (3-year value: $2.1M)

• Massachusetts Statewide Technology Transfer Center. This expanded center, to be affiliated with and housed at one of the UMass campuses, will accelerate and improve the efficiency of technology transfer from research institution to industry. A transfer center will facilitate the introduction of new products or services, which will create jobs. (3-Year value: $2.1M)
• Matching funds for federal Research and Development grants. These matching grants, to be offered to colleges, universities and other entities (public or private) for research and development activities in new and emerging technologies, will improve the competitiveness of Massachusetts’ research institutions in competing for federal funding. (3-Year value: $15M)

• Bridge Loans to qualified grant recipients. These loans will be offered to small businesses and other qualified grant recipients for the period between the award of the grant and the actual receipt of funds. All loan payments will revert to this fund for future loans. (3-Year value: $6M)

2. TRAINING WORKERS

The Romney “Jobs First” plan improves the skills of laid off and incumbent workers through increased training opportunities. When employers are surveyed about why they choose to grow or expand in Massachusetts, they most often cite our highly skilled workforce. We must continue to invest in our workers.

Restore appropriations for the Workforce Training Fund. Employers pay $8.10 per employee per year into the Workforce Training Fund to pay for workforce training grants. Grants are awarded to both employers and labor unions that undertake employee training to: a) Promote job growth, job retention or increase wages; and b) Improve organizational productivity, competitiveness and their ability to do business in Massachusetts. (3-Year value: $57.8M)

Non-degree tuition assistance loans. Most existing loan programs are focused on degree only programs.This low-cost, broad based loan program will allow individuals to enroll in non-degree, short-term training programs leading to a recognized credential to advance their chosen careers or change careers to reenter the workforce. (3-Year value: $1.8M)

Training partnership between community colleges, one stops and industry. This program will provide grants to partnerships between community colleges, local workforce boards, One Stop Career Centers and specific businesses or industry groups to develop curricula to provide training to develop the skills of unemployed and underemployed workers within that business or industry. By building partnerships between the public and private sectors, the program matches the needs of in-demand businesses/industry sectors with unemployed and underemployed job seekers. (3-Year value: $1.8M)

DEVELOPING MORE HOUSING AND COMMERCIAL SPACE

The Romney “Jobs First” plan offers targeted initiatives which begin to address the high cost of housing in Massachusetts – often cited as the number one barrier by employers to expanding or locating jobs in the Bay State. It also encourages the redevelopment of the 7,000 brownfields sites so that more jobs can be created near where workers live.

• Provide communities up to a $3,000 sales tax rebate for the targeted development of new or renovated housing. To encourage communities to increase the number of housing units built, this proposal will provide cities and towns with up to a $3,000 rebate on the sales tax paid by builders for the materials used in the targeted development of new or renovated single and multi-family homes. This provision sunsets after three years to encourage immediate activity. (3-Year value: $9M)

• Housing mitigation payment to communities to encourage residential use of state surplus property. This provision creates an incentive to encourage cities and towns to make state surplus property “housing-friendly” by changing zoning regulations to allow for new housing starts. If the land is used for housing, communities will be eligible to receive up to 50 percent of the enhanced value of the surplus property when it is sold by the state. (3-Year value: $6M)

Matching grants for local urban revitalization. This program will offer matching grants of up to $200,000 to seven Massachusetts cities (one in each region) to establish business district revitalization programs that create new businesses and jobs. (3-year value: $1.4M)

Increase the Economic Opportunity Credit for brownfields sites from 5 to 10 percent. This initiative expands the successful Economic Development Incentive Program (EDIP) to offer businesses that locate on a brownfield site a 10 percent ITC credit instead of the standard EDIP ITC credit of 5 percent. (3-Year value: $2.7M)

Extends tax credit for brownfield site clean up. (3-year value: $1.8M)

Recapitalize the BRAC insurance fund. To mitigate the risk for businesses to expand on brownfields, the Brownfields Redevelopment Access to Capital (BRAC) insurance program makes available and subsidizes environmental insurance to borrowers and developers who purchase, clean up or develop brownfields sites in Massachusetts, and to lenders who finance the projects. (3-Year value: $8M)