Worcester Business Journal

6 Worcester Business Journal • March 14, 2016 www.wbjournal.com NG-CEE-412 // Worcester Business Journal // CommAWARE_Unexpected Maintenance // Page Type // Trim Area: 9" x 6" // 4C // 300 dpi When you upgrade to the latest energy systems, you'll find they're more reliable for longer periods, which means less interruptions in day-to-day operations. Find ways to upgrade your business at ngrid.com/save Upgraded equipment has better odds of avoiding unexpected maintenance. National Grid is a proud sponsor of Mass Save. I t's happening in Los Angeles and New York state; it almost happened in Providence, and it could happen in Boston. Now, the national push for a $15 minimum wage has made its way to Worcester. Labor advocates are pushing the Worcester City Council to update its requirements so any developments or businesses that receive special tax-incre- ment financing (TIF) must pay their employees at least $15 an hour, which some say could help build enough momentum so that salary becomes the new minimum standard in the state and the country. On the other hand the city's business community and some city councillors said such a move is outside the city's responsibilities and would be an impediment to future development. "If the council wants to put this requirement on a business owner, I would hope they'd be looking through and making sure city employees are within the same bounds," said Stuart Loosemore, general counsel and director of government affairs and public policy at the Worcester Regional Chamber of Commerce. Ultimately, the change – if made – would have little actual impact since it would only apply to employees of future TIF recipients. Current city TIF guide- lines call for a $12.50 minimum wage on TIF recipients. However, labor activists and some councillors said higher wages are probably necessary to ensure the economic stability of residents over time. The political battle, though, remains over the symbolism, as $15 per hour could give fuel to the nationwide mini- mum wage movement and/or serve as an example of the city's unfriendliness towards business. "Economic development must be community development. Working to create jobs for residents of our commu- nity should be seen as part of an effective holistic development process, not as a restriction to economic development," said Matt Feinstein, co-director of the Worcester Roots Project, a member of the Worcester Community Labor Coalition. TIF implications The higher minimum wage would only apply to people whose jobs were created because their company used TIFs as a development incentive. TIF projects are city-approved developments that receive an exemption on a portion of the new tax revenue they generate over the course of the agreement, which can last between five and 20 years. Companies can receive up to 100-per- cent exemption over the course of the plan, though the highest current exemp- tion is 64 percent. As of December 2015, there were 18 active TIF projects, eight of which began in the last five years, according to the city's Executive Office of Economic Development. Saint Vincent Hospital, the Hanover Insurance Group and Polar Beverages were all developed using TIF. TIFs don't offer a tax break on what businesses currently pay, but they are an exemption on a portion of taxes of the increased value of a building after it is upgraded, Loosemore said. Imposing a minimum wage on developers would be outside the bounds of what TIFs were designed to do, since they're supposed to be a roadmap for developers, not a poli- cy statement, he said. "Some of the details that are beneficial to [a developer] may not be beneficial to [a different developer]," Loosemore said. "The manager should be allowed flexi- bility to negotiate deals on a case by case process." Whether or not it is a city's place to set its own minimum wage remains to be seen, said Paul Sonn, general counsel and program director for the National BY LAURA FINALDI Worcester Business Journal Staff Writer Worcester's $15 symbolism battle Worcester residents rallied for a $15 minimum wage on Feb. 23. City councillors are looking into requiring businesses that use tax-increment financing to pay employees at least $15 an hour. P H O T O / C O U R T E S Y

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