Patrick signs economic development law

Governor Deval Patrick signed an economic development bill Tuesday that creates a sales tax holiday this weekend and provides millions of dollars to retrain unemployed workers, but he vetoed several tax incentives.

Patrick rejected a provision to give start-ups a $456 tax credit for three years to offset the cost of the state’s minimum corporate excise tax.

He also vetoed a $10 million-a-year expansion of the Historic Preservation Tax Credit program, aimed at saving historic structures, and an extension of the Brownfields Tax Credit, which provides incentives to redevelop polluted sites, beyond its expiration date of August 2013.

Greg Bialecki, state secretary of housing and economic development, said the governor wanted to set a precedent of not creating, extending, or expanding tax incentives without more careful analysis of the potential benefits and costs. He said the state has time to conduct such a study and extend the Brownfields program before it expires.

“We thought it was a terrific package that produces a lot of wins for the business community at a very modest additional expenditure,” Bialecki said. But “we were not comfortable with the bang for the buck or effectiveness” of the incentives.


In addition, Patrick vetoed language that would have expanded the definition of Gateway Cities — generally former industrial cities that have fallen on hard times — to allow Attleboro to qualify, the second time this year Patrick has rejected a proposal to tweak the definition to help more communities become eligible for aid through the program.

Administration officials said the governor wanted to preserve benefits for two dozen cities, since the programs have limited funding. Under current law, Gateway Cities must have a population of between 35,000 and 250,000 with lower household incomes and fewer college degrees than the statewide average. Attleboro’s income is slightly above the state average.


“No line is perfect,” Bialecki said, but “we’ve taken the view that it was a thoughtfully drawn line.”

Patrick approved most of the provisions in the bill, including one to allow shoppers to avoid sales taxes in Massachusetts on Saturday and Sunday (except for restaurant meals, tobacco, and purchases of more than $2,500.) The sales tax holiday has been a perennial favorite with many merchants and consumers, although some economists say it does little to stimulate the economy, essentially shifting purchases from one weekend to another.

The legislation also establishes a $50 million fund to help the University of Massachusetts and other colleges support research that could lead to new technology, $5 million for a program to help train workers, $1 million in matching grants to create technology internships, and $1 million for incubator space and other support for start-ups.

Todd Wallack can be reached at Follow him on Twitter @twallack.