To woo GE, state and city painted bright picture
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The pitch book that state and city officials used to woo General Electric shows an all-out effort — complete with promises of new ferries and access to airplane hangars — to package the city as a hotbed of innovation too promising for GE to ignore.
The 11-page brochure, obtained by The Boston Globe Thursday, is part real estate guide, part glossy tourism brochure. It features a variety of helipad-accessible sites that GE should consider, along with a long list of benefits that the industrial conglomerate could enjoy by moving here.
Missing from the book, though, are the financial incentives that the state and city ultimately pledged to GE. Those became public Wednesday once the company confirmed its decision to come to Boston.
The combined state and city package for GE could total more than $150 million, an economic development deal that will deliver 800 jobs to the city.
On Thursday, Governor Charlie Baker defended the decision to offer one of the most lucrative relocation incentive packages in state history.
"This will be a good investment for Massachusetts and for the city of Boston," Baker said in an interview. "The tools that we'll be using are the same tools that have been in place for a very long time and have been used by prior administrations for years."
The math, on its surface, can seem like a steep price: perhaps as much as $189,000 per job.
But the Baker administration said the state's primary contribution — worth as much as $120 million — will go toward site improvements on the property that GE eventually picks for its new headquarters, not to tax breaks.
That could mean anything from a new building to a parking garage to roadwork and utility lines, the Baker administration said. The exact cost could be considerably less: It depends on the property. GE hasn't picked one yet, although its sights are set on the Seaport area.
In addition to the potential $120 million package, the Massachusetts Life Sciences Center will give $5 million to create a new innovation center to better connect GE with the region's research institutions and the state will provide $1 million in workforce training funds.
To help persuade GE to move its headquarters from Fairfield, Conn., to Boston's Seaport area, the city is also kicking in money: as much as $25 million in property tax relief, spread over 20 years.
The pitch book offers GE an array of additional benefits: a hangar at Hanscom Air Force Base "to accommodate six airplanes for General Electric to fly to and from Logan International Airport," assistance finding child care and schools, and the potential for "General Electric signage on properties," to help promote the GE brand. There's even the promise of a trolley tour of Boston, led by city employees.
The pitch brochure focuses on at least eight available sites: They're all publicly owned and most are on the South Boston waterfront. It also highlights two planned ferry projects, the ease of access to Logan Airport, and other benefits of the region's transportation infrastructure.
But it skips over the gridlock that plagues the South Boston waterfront at rush hour. And there's no mention of the MBTA's many woes.
Some critics of corporate giveaways wondered aloud this week whether GE would have come to Boston anyway, even without the raft of incentives. They pointed to chief executive Jeffrey R. Immelt's media statement on Wednesday in which he said the company zeroed in on the city's universities and culture of innovation, not on the incentives.
But the criticism was generally muted, with left- and right-leaning local groups more excited than annoyed about the possibility of landing one of the biggest companies in the world.
Even Senator Elizabeth Warren, who has vilified GE as a tax-dodger in the past, offered an upbeat statement about the move.
The generous incentive package resembles one awarded about 10 years ago to Bristol-Myers Squibb to build a drug manufacturing plant in Devens. In that case, a MassDevelopment spokeswoman said the initial award totaled $60 million in infrastructure improvements and more than $8 million in property tax relief.
Adam Langley, a senior research analyst at the nonpartisan Lincoln Institute of Land Policy in Cambridge, said it's important to be cautious about not setting an expensive precedent.
"GE is a huge company. A one-time thing might be OK," Langley said. "But if every company says 'GE got $120 million, we should get at least $5 million or $10 million,' if that becomes common practice, that can become really expensive."
The fact that most of the state money will go toward infrastructure didn't mollify state Senator Jamie Eldridge, a Democrat who is an outspoken critic of corporate incentives. He said the money could be better spent shoring up the financially ailing MBTA system, for example.
"That's a question for Governor Baker: Is this an investment that's going to benefit the residents of metropolitan Boston, or is it just going to allow the executives at General Electric to be able to have an easier commute?" Eldridge said.
But except for pockets of criticism, few, if any, local advocacy groups were willing to outright oppose the deal.
"I haven't seen any evidence that we needed to do that kind of package," said Noah Berger, president of the left-leaning Massachusetts Budget and Policy Center. "[But] if we're doing infrastructure work, that's good for our state, and GE is the beneficiary of it, that's much more efficient than tax giveaways."
At the right-leaning Pioneer Institute, executive director Jim Stergios also sounded a cautiously optimistic tone. Stergios described the package as a modest offering compared with the long-term benefits that a GE headquarters brings to the city and the region.
"I don't believe what we're giving them remotely [compares with] what other states were going to put on the table," Stergios said.