Waiting until the last moment to reach an agreement on a sweeping economic development bill turned out to be a bad decision this time around for the Legislature, as formal sessions on Beacon Hill ended for the year on Monday with the fate of the $4 billion-plus spending plan still up in the air.
Business leaders quickly bemoaned the failure to reach a compromise. The bill had seemed all but a sure thing a week ago. But now it’s not clear when a final package, which was expected to include at least $1 billion in tax cuts, might cross the finish line.
“It’s too bad that we got this close,” said Chris Carlozzi, state director for the National Federation of Independent Business. “This should have been a priority from the beginning.”
Whatever does finally emerge will inevitably be slimmed down. Competing House and Senate versions of this legislation would have been funded by a combination of state surplus funds, bonding, and federal relief money. Lawmakers still meet in informal sessions through the year’s end, but they can’t hold roll call votes and just one person can block a bill. As a result, they can’t take up bonding authorizations in informal sessions and typically avoid any controversial measures.
Joe Kriesberg, head of the Massachusetts Association of Community Development Corporations, had been lobbying for as much as $500 million in various housing initiatives, as well as $200 million in small-business assistance, including $75 million to help businesses run by people of color expand into the often-insular development sector.
“We’re just extremely disappointed,” Kriesberg said. “We’ve been working on this for 18 months. We have urgent needs in our economy.”
It’s not just housing funds and small-business assistance at stake. Advocates await hundreds of millions for high-priority items such as healthcare and unemployment insurance. Also left up in the air: policy measures that would have made it easier to build “starter homes” across the state, expand the Boston Convention & Exhibition Center, allow more development at the former Devens military base, and develop a sports venue such as a soccer stadium for the New England Revolution on unused industrial land in Everett.
“I’m pretty crestfallen to hear this was the fate,” said Mass Audubon lobbyist Sam Anderson, referring to his group’s hopes to secure up to $300 million for open-space preservation.
Legislative leaders placed much of the blame on a last-minute revelation: The Baker administration disclosed last week that the state may owe taxpayers up to $3 billion in refunds, thanks to a 1980s-era law intended to put the brakes on the state’s tax revenue growth. The exact amount won’t be known until September, and lawmakers worried about spending so much on tax relief and economic development when the state might be on the hook for those refunds as well.
“You can’t help but be disappointed that it didn’t get done,” said Jim Rooney, chief executive of the Greater Boston Chamber of Commerce, of the economic development bill. “[But] given that they only had four or five days to process all of that, I can see how they ended up where they are.”
Amy Pitter, president of the Massachusetts Society of CPAs, worries that permanent tax reform could take a back seat now to one-time relief in the form of rebates. In particular, her organization had been pushing for changes to the Massachusetts estate tax, which kicks in at $1 million in estate value, less than the value of a typical three-bedroom home in many Massachusetts communities. That threshold is tied with Oregon’s as the lowest in the country. (Other proposed reforms that are on the line include deductions or credits to help renters, seniors, and parents.)
“I worry about the flight of high-income people,” Pitter said. “But that worries me less than the impact on middle-class taxpayers.”
Many business leaders tried to remain hopeful as the Legislature essentially adjourned for summer recess. Paul Sacco, president of the Massachusetts Lodging Association, said he hasn’t given up on $75 million to help hotels and other lodging establishments across the state that were hammered in 2020 and 2021 because of the COVID-19 pandemic, for example.
Peter Lowitt, director of the Devens Enterprise Commission, has been sounding the alarm that the base-turned-industrial park could soon hit a statutory cap on development. At Senator Jamie Eldridge’s request, language was inserted in the Senate’s economic development bill to lift the cap from 8.5 million square feet to 12 million square feet, after getting the OK from officials in the three base towns.
Lowitt said the lack of opposition should give it a route for clean passage in informal sessions. “We’ve got our fingers crossed,” Lowitt said.
The same is not true for a measure tucked into the House bill that would have lifted certain significant development restrictions for a portion of the sprawling Mystic power plant property off Alford Street in Everett, across Broadway from Wynn Resorts’ Encore Boston Harbor casino. Plant owner Constellation recently hired brokerage CBRE to market a 40-plus acre section that it no longer needs; that land is being eyed as a possible home for a New England Revolution soccer stadium, though other possible users or bidders may emerge.
The Conservation Law Foundation has fiercely fought the amendment, saying the property should remain subject to decades-old laws regarding waterfront development.
So at least someone had reason to celebrate the Beacon Hill standoff on Monday.
“If the Alford Street amendment does not pass this session, it will be a major win for the community and for waterfront public access,” said Deanna Moran, interim vice president of healthy and resilient communities at CLF. “Backroom deals that favor developers over community input and public access have no place in Massachusetts.”