A state board last week approved a local tax break Beverly has agreed to provide a life sciences firm that plans a $20 million renovation of a Tozer Road building.
The City Council, acting at the request of Mayor William F. Scanlon Jr., had voted unanimously Nov. 7 to approve the tax increment financing agreement with the firm, Cell Signaling Technology.
The state’s Economic Assistance Coordinating Council unanimously approved the agreement Dec. 21, according to Matthew Curran, corporate controller for the firm. A positive vote by the council was required for the agreement to take effect.
Cell Signaling, which is headquartered on Trask Lane off Route 128 in Danvers and Beverly, currently uses a small section of the 32 Tozer Road building that it upgraded in a $2.5 million project last year.
The company, which creates research tools for the life sciences industry, now plans to fully renovate the remainder of the 87,000-square-foot building, which will provide it with new space for production and research and development.
‘The tax revenue the city will get as a result of this investment we are trying to encourage is a very big thing.’Tina Cassidy Beverly director of planning and development
The Tozer Road building previously served as the headquarters of New England Biolabs. It has been vacant or underutilized since that company relocated to Ipswich in 2005, according to Cell Signaling officials. An affiliate of Cell Signaling purchased the property in 2006.
Under the tax agreement, Cell Signaling will be exempted for 10 years from taxes on 5 percent of the increased value of the property resulting from its investment, providing the firm with a total savings over that time of about $100,000.
Tina Cassidy, Beverly’s director of planning and development, said the city welcomes the project.
“The tax revenue the city will get as a result of this investment we are trying to encourage is a very big thing,’’ she said, estimating that Beverly will collect about $1.9 million in new taxes from the property over the 10-year period.
Cassidy said Cell Signaling has also pledged to create 100 new permanent jobs within five years of completing the construction.
“That’s a big plus for the community,’’ she said, noting that all the jobs will be “fairly well-paying,’’ with an average annual salary of $70,000.
She said the new employment will have a positive spin-off effect on the local economy since many of the workers will likely live in or near the city and patronize local businesses.
On top of the permanent jobs, Cell Signaling estimates the construction will create up to 100 temporary jobs, according to Curran.
Beverly is able to offer the tax break because of its joint designation with Salem as an economic target area, under the state’s Economic Development Incentive Program.
The city’s Economic and Community Development Council, which reviews proposed tax breaks, in September unanimously endorsed the one proposed for Cell Signaling.
The council’s vote in November approved both the tax agreement and the designation of the Tozer Road site as an economic opportunity area, which makes it eligible for the tax break.
Firms that earn local tax relief also become eligible under the same state program for an earned income tax credit of up to 5 percent, which is typically larger in value than the local tax break.
Curran said Cell Signaling is seeking that state tax relief, but under an alternative program the state has established for life sciences firms.
Beverly and Danvers both previously awarded Cell Signaling tax breaks for the firm’s project to redevelop the former King’s Grant Inn into its current headquarters on Trask Lane, which it opened in December 2005.