Two-part Globe series spotlights MassINC research
A two-part Boston Globe series examining the state’s economic development investments in revitalizing cities brings to light problems exposed in a 2008 MassINC study, Going for Growth: Promoting Business Investment in Massachusetts Gateway Cities.
The Globe details how the state’s Economic Development Incentive Program (EDIP) –designed to spur investment in older urban areas with legitimate barriers to development – has been distorted to the point where the state subsidy no longer provides a beneficial impact.
Manufacturers departing from these cities left behind difficult to reconfigure buildings and environmental contamination. This legacy makes costs prohibitive for new businesses that might otherwise reinvest in these communities. The EDIP program was established to help older industrial cities over come these barriers, and reposition for the state’s new economy.
The Globe’s reporting shows how the program has not been administered to accomplish its goal. EDIP incentives have gone largely to affluent communities with large tracts of raw land that are much less costly to develop. By making these tax subsidies available to companies regardless of where they locate, the incentive to choose older cities has been eliminated, negating the program’s original intent.
While other much larger state tax incentives, such as the investment tax credit, the R&D tax credit, and the Life Sciences tax credit, are available to spur job creation in the Commonwealth, this is the only tool designed to give businesses an incentive to take on the added cost associated with redeveloping in an older urban area.
MassINC is hopeful that legislation recently advanced and passed by the Patrick administration will result in more strategic and impactful use of EDIP funds, particularly in regional Gateway Cities outside of Greater Boston, where new investment is needed to drive growth in other parts of the state.Read more about MassINC’s Gateway Cities Initiative