Worcester Business Journal

wbjournal.com | January 21, 2019 | Worcester Business Journal 11 C o m m e r c i a l R e a l E s t a t e F O C U S sizeable portion of those tax breaks went to large corporations with significant profits, and critics argue cities and towns are sacrificing potential revenue when the benefitting companies would have made the investments regardless. Still, municipal leaders turn to tax breaks in a bid to keep companies grow- ing in the community or to draw them from elsewhere. For AIS, a tax break helped the company grow to 700 workers and stay close to where it was founded. Other manufacturers attracting tax breaks include Rocheleau Tool & Die Co., a third-generation family-owned maker of molding machinery in Fitchburg; and F&D Plastics, a family-run Leominster plastics maker founded more than 40 years ago. Communities are oen in a battle against one another – and with oth- ers outside the region or even outside the country – to keep or attract new companies, said Dean Mazzarella, the Leominster mayor. ey oen turn to tax breaks. "A lot of these companies were being courted," said Mazzarella, who's overseen 21 tax breaks in the last two decades. The Amazon question Business tax breaks have come under more public criticism lately, thanks in large part to online retailer Amazon. When Amazon announced in 2017 it was looking to open a second headquar- ters, unlikely landing spots and large cities alike pitched the company on ma- jor tax breaks. Worcester offered $500 million, and Leominster $405 million. Larger areas offered far more. Mary- land offered $8.5 billion, and New Jersey $7 billion. In the end, New York City and Ar- lington, Va., split the Amazon expansion. It was not without major incentives for one of the world's largest companies, though far less than what the company could have gotten elsewhere. New York gave $2.8 billion in tax breaks and grants, and Virginia $573 million. ose funding agreements were criticized, as New York's projected return on investment didn't consider addition- Tax breaks, by community Number of Total promised Total promised Community tax breaks jobs* investment* Notable recipients Worcester 28 1,104 $601,085,000 Hanover Insurance, Polar Beverages, Saint-Gobain Leominster 21 650 $127,951,000 AIS, Dixie Consumer Products, F&M Tool and Plastics Fitchburg 18 703 $249,565,000 Caraustar, Great Wolf Lodge, Medstar Ambulance Marlborough 16 1,869 $593,477,000 Boston Scientific, TJX, GE Healthcare Life Sciences Milford 11 545 $160,495,000 Consigli, Waters Corp., Clarke Gardner 10 381 $38,290,000 Advanced Cable Ties, New England Peptide Framingham 9 621 $108,400,000 TJX, Jack's Abby, Lifeline Systems Sturbridge 7 149 $0 Publick House, Holiday Inn Express, Arland Tool & Manufacturing Westborough 7 755 $0 Cumberland Farms, Astellas, eClinicalWorks Hudson 6 85 $14,960,000 Holiday Inn, CPI Radant, Hudson Lock Hopkinton 4 553 $93,000,000 Stryker, Lonza, Perkin Elmer Oxford 4 800 $82,400,000 IPG Photonics Charlton 3 35 $100,000 North American Tool & Machine Corp. Northborough 2 107 $28,900,000 A. Duie Pyle Natick 1 400 $150,000,000 MathWorks Shrewsbury 1 300 $67,000,000 Charles River Laboratories Notes: Tax breaks are from 1998 through early 2018. In addition to the 16 communities in the chart, Auburn, Millbury and Southborough were asked for their tax break information but said they have have issued no such tax breaks. The communities were chosen because of their size and location. *Not all agreements require companies to specify investment or job creation goals. Sources: Respective communities Big corporate tax breaks Tax breaks don't go just to smaller businesses looking for savings but also to some of the biggest — and most profitable — companies. Some of the largest companies to receive tax breaks, and their reported net income the year they signed a tax break: Year tax Net Tax break Company break received income Community details Boston Scientific Corp. 2012 $441 million Marlborough Investment of $250 million to move from Natick into former Addition Hill Corporate Center Hologic,. Inc. 2006 $27 million Marlborough Company committed to hiring 150 workers in $7.5-million expansion Intel Corp. 1999 $6.1 billion Hudson Company didn't have set hiring or investment thresholds; agreement later decertified IPG Photonics 2018 $348 million Oxford 15-year tax break given in exchange for $67.9-million expansion for 400 new jobs Sunovion 2009 $515 million Marlborough New campus buildings were planned in Pharmaceuticals, Inc. $47-million expansion for 250 new jobs TJX Cos. 2012 $1.5 billion Framingham, Company promised $26.4-million expansion in Marlborough Framingham and $54 million in Marlborough Waters Corp. 1999 $90 million Milford Plant expansion worth $6 million was promised, along with 177 new jobs Source: respective communities, Securities and Exchange Commission Continued on next page al costs of having Amazon in the city, including for police and fire protection, among other services. Critics questioned whether the tax breaks even played a role in Amazon's decision. Aer all, the company could have gotten billions more by simply locating on the other side of Washington, D.C., in Maryland instead of in Virginia. "When politicians talk about the benefits of incentives, such as 'We gave $1 million to attract 1,000 jobs,' they are assuming that incentive was pivotal in bringing the investment," said Nathan Jensen, a professor at the University of Texas who researches government eco- Leominster Mayor Dean Mazzarella

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