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Boston. Local, state and national groups call for greater accountability and transparency of corporate tax breaks at a State House hearing today. Many organizations including MASSPIRG, One Massachusetts, Coalition for Social Justice, Common Cause Massachusetts, and Good Jobs First urged the Joint Committee on Revenue to support An Act to Promote Efficiency and Transparency in Economic Development, H.2565, filed by Representative Carl Sciortino (Somerville) and Senator James Eldridge (Acton) along with a bipartisan list of 50 additional cosponsors.
The hearing was especially timely given the recent news of some high profile companies including Fidelity, Evergreen and General Electric leaving the state and or shedding jobs after receiving millions of tax dollars in subsidies to create jobs. “Any investment of public dollars in private enterprises must be held to the highest level of transparency and accountability,” testified Deirdre Cummings, Legislative Director for MASSPIRG.
“Massachusetts spends hundreds of millions of dollars each year on economic development subsidies – and yet legislators, the administration, and the general public often don’t know where that money is going, how many jobs are actually being created, and whether the Commonwealth is getting a good return on its investment,” said Senator Jamie Eldridge. “That’s unacceptable. It’s time to make all this information public, and start holding companies accountable for creating the jobs they promise to create.”
The bill requires that all economic development tax breaks on both the state and local level be transparent and posted on the state budget website; requires improved reporting data to evaluate the success of the investments; sets standards for successful economic development programs and holds companies accountable to their job creation commitments by requiring companies to pay back the value of the tax break if they fail to meet their promised commitments.
Representative Carl Sciortino said, “This is an opportunity for legislators to stand on the side of our taxpaying constituents and put pressure on companies to follow through on their promises. If a company agrees to create a certain number of jobs in exchange for a subsidy, and they fail, we should get our money back. This money can be used to subsidize more effective job creation elsewhere or put towards crucial human services in our communities.”
“Given the Evergreen Solar and Fidelity Investments setbacks,” said Greg LeRoy, Executive Director, Good Jobs First, “Massachusetts needs safeguards to protect taxpayer investments. The proposed accountability legislation is based on best practices from many other states and would help ensure that good jobs are created or else subsidies get refunded.” Debra Fastino, Director of the Coalition for Social Justice added, “The reforms will allow our legislators to be able to make rational choices regarding tax credits and subsidies while armed with a provision to hold corporations accountable for their actions.”
"By having a transparent and inclusive government, we increase the confidence of the people in our communities to work together with it and achieve results that otherwise we can't achieve as individuals," concluded Sondra Peskoe, One Massachusetts.
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