Patrick signs jobs bill, vetoes tax credits

Gov. Deval Patrick signed an economic development bill into law on Tuesday but vetoed a number of provisions that would have extended or expanded some of the state’s existing tax credits.

Greg Bialecki, Patrick’s secretary of housing and economic development, said the governor’s vetoes were based on the recommendations earlier this year of the state’s Tax Expenditure Commission, which was made up of lawmakers, constitutional officers, and administration officials. The commission recommended that tax credits be evaluated periodically for their effectiveness. The commission also said the total number of tax credits, which last year cost the state $26.6 billion in lost revenue, should be reduced.

The provisions vetoed by the governor would have extended the life of the so-called brownfields tax credit by two years, increased the size of the historic rehabilitation tax credit program from $50 million to $60 million a year, and provided a new credit to offset the minimum tax payment assessed on new corporations. The credits would have cost the state an estimated $45 million initially.

Bialecki said anecdotal evidence suggests the tax credits are effective, but he said the governor wants to follow the recommendation of the Tax Expenditure Commission and wait until more concrete evidence is available indicating the tax credits are working as intended. He said the administration will support extensions or expansions of the tax credit if that’s what the evidence indicates, but added: “We do intend to take a harder look at tax expenditures generally.”

The increase in the historic rehabilitation tax credit program was a high priority of the Gateway Cities legislative caucus, which sees the initiative as a vehicle to help spur redevelopment of old mills and other historic structures. Rep. Antonio Cabral, cochair of the Gateway Cities caucus, late last month hailed the $10 million increase in the tax credit cap as a historic breakthrough.

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Bruce Mohl

Editor, CommonWealth

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

But the program, which is administered by Secretary of State William Galvin, has never been evaluated and often been shrouded in mystery. With the Legislature out of session, the governor’s vetoes won’t be overridden.

The new law provides enhanced funding for job training and internships, boosts infrastructure development, and authorizes a sales tax holiday this weekend. No overall cost figure for the legislation was available.