By Sam Larson
Vice President, Government Affairs

Today, Massachusetts Governor Maura Healey signed economic development legislation following the Legislature’s recent passage of the sweeping package designed to encourage job creation and enhance the state’s overall economic competitiveness.

The bill, H.5100, An Act relative to strengthening Massachusetts’ economic leadership, authorizes $4.96 billion in long-term borrowing to support legacy Massachusetts industries like life sciences as well as emerging sectors like climatetech and applied artificial intelligence.

The legislature returned for a rare post-election formal session last week for both House and Senate to conduct roll call votes required to approve the bill.  House and Senate leaders did not reach a compromise on their chambers’ different versions of the bill until after the traditional July 31 deadline. The AIM Government Affairs team worked throughout the fall to help bring the parties together to reach a final agreement.

“This Economic Development bill reflects the legislature’s clear commitment to supporting the business community and boldly declares that Massachusetts is open for business.” said Brooke Thomson, President and CEO of AIM.

“This bill doubles down on the state’s past successes and paves the way for Massachusetts to both retain major sectors and become the home to important emerging industries. We thank our partners on Beacon Hill for their continued support for delivering results for our members.”

The legislation broadens the state’s commitment to the life-sciences industry with a $500 million reauthorization over the next 10 years. These previously existing funding and tax benefits made the Commonwealth the number one state for life sciences. However, with competitors courting key companies, state policy makers decided to reaffirm their commitment to the industry. The bill adds health equity, biosecurity, digital health, and artificial intelligence to the mission of the Massachusetts Life Sciences Center and raises the annual tax-credit authorization for the life sciences industry from $30 million to $40 million.

The legislation uses the success of life sciences subsidies and tax credits as a model for the emerging climatetech industry. The bill provides $400 million in capital resources to the Massachusetts Clean Energy Center (MassCEC) to utilize over the next 10 years, with $200 million authorized to support innovation and deployment of climatetech technologies and $200 million to support the offshore-wind industry.

It also establishes a tax credit for investments in climatetech companies. A new program housed at MassCEC will develop and expand employment opportunities in climatetech and promote climatetech-related economic development by supporting and stimulating research, development, innovation, manufacturing, deployment and commercialization. The credit will be subject to a $30 million annual cap.

The bill also contains several new tax credits to help other industries, including a new $7 million-a-year credit to support live theater productions as well as tax credits to support the construction of data centers necessary to implement artificial intelligence upgrades. There is also a brand-new internship tax credit through which companies can recoup $5,000 a year if they provide paid internships to students from Massachusetts colleges.

In addition to the large spending commitments and tax breaks, the economic development bill contains several new policy sections that will also help support Massachusetts business. The legislation in particular has many provisions that will help smaller businesses.

For instance, the Commonwealth will now assist small businesses in acquiring surety bonds. Large capital projects, whether public or private, often require retention of a surety bond by the contractor as financial security. Economically and socially disadvantaged businesses often cannot acquire these bonds because of a lack of credit history or collateral. This program creates a self-sustaining state assistance program to open doors for more of these businesses.

The Legislature also paved the way for the construction of a professional soccer stadium in Everett. The Kraft Group has long sought a Great Boston home for the New England Revolution and an adopted Senate amendment allows for land in Everett to be used for a professional stadium. The stadium owners will have to enter into mitigation agreements with both Everett and the city of Boston and no public funds can go towards the building of the stadium.

The bill will extend state and local permits already granted for development projects between January 1, 2023, and January 1, 2025, for an additional two years. Many worthwhile projects have been stuck due to lack of funding because of high interest rates and starting the local approval process over again would kill them. AIM supported this provision, which provides the necessary breathing room to complete many important projects.

This summary is meant to provide a highlight of a few of the key sections that will help AIM member businesses. Please contact me at slarson@aimnet.org for additional details. In the weeks ahead, the Government Affairs team will be working with members to make sure they are taking full advantage of all the generous benefits in this bill.