General Laws

Section 3F. (a)(1) The EACC may from time to time designate a project as a certified expansion project, a certified enhanced expansion project, a certified job creation project or a certified manufacturing retention project and take all actions necessary or appropriate thereto, upon:

(i) receipt of a project proposal therefor requesting such designation from the controlling business;

(ii) receipt of a municipal project endorsement which shall include the following findings based on the information submitted with the project proposal and such additional investigation as the municipality shall make:

(A) the project proposal complies with the definition of a project proposal set forth in section 3A;

(B) in the case of an expansion project proposal, the expansion project is consistent with and can reasonably be expected to benefit from the municipality's plans relative to the project EOA, if applicable;

(C) together with all other projects previously certified and located in the same municipality, will not overburden the municipality's supporting resources including, but not limited to, those set forth in clause (f) of paragraph (2) of section 3E;

(D) the project proposal includes a workable plan, with precise goals and objectives, by which the controlling business proposes to realize the increased employment objectives for the project and the business' plan to employ aggressive affirmative action goals, objectives and identification and recruitment techniques and, in the case of an expansion project, the plan for increased employment from among residents of the expansion project ETA, if applicable;

(E) the project proposal contains documentation regarding an agreement, if any, between the controlling business and area banking institutions by which the controlling business agrees to establish accounts in those banks and those banks agree to commit a specified percentage of the funds deposited in the accounts for loans made to businesses located within the expansion project area pursuant to the small business capital access program established pursuant to section 57 of chapter 23A;

(F) the project as described in the proposal, together with the municipal resources committed to the project, will, if certified, have a reasonable chance of increasing or retaining employment opportunities as advanced in the proposal; and

(G) in the case of an expansion project, any municipality in which the expansion project is located or shall be located has offered to enter into a tax increment financing agreement meeting the requirements of subsection (f) or (g) or to provide a special tax assessment meeting the requirements of said subsection (g);

(iii) receipt with the municipal project endorsement of a request by the municipality for a designation of the project as a certified project for a specified number of years which shall be not less than 5 years nor more than 20 years; and

(iv) the following findings are made by the EACC, based on the project proposal, documents submitted therewith, the municipal project endorsement, and such additional investigation as the EACC shall make and incorporate in its minutes, that:

(A) the project proposal complies with the definition of a project proposal set forth in section 3A, with all other applicable statutory requirements and with such other criteria that EACC may prescribe; and

(B) the project as described in the proposal, and as further described in the written determination of the municipality made pursuant to clause (ii) will, if certified, have a reasonable chance of increasing or retaining employment opportunities for residents of the ETA or municipality, as applicable; and

(2) Notwithstanding sections 3 to 3H, inclusive, no certified expansion project shall be required to be located within an ETA or an EOA; provided, however, that an expansion project proposal shall be accompanied by a municipal project endorsement that meets the requirements of clause (ii) of subsection (a).

(b) A certified project shall retain its certification for the period specified by the EACC in its certification decision; provided, however, that such specified period shall be not less than 5 years from the date of certification nor more than: (i) 20 years from such date; or (ii) the number of years requested by the municipality approving the project proposal, whichever is lesser, unless such certification is revoked prior to the expiration of the specified period. The certification of a project shall be revoked only by the EACC and only upon: (1) the petition of the municipality that approved the project proposal, if applicable, if the petition satisfies the authorization requirements for a municipal application or the petition of the director of economic development; and (2) the independent investigation and determination of the EACC that representations made by the controlling business in its project proposal are materially at variance with the conduct of the controlling business subsequent to the certification and such variance is found to frustrate the public purpose that such certification was intended to advance; provided, however, that for an expansion project where the actual number of permanent full-time employees employed by the controlling business at the project is less than 50 per cent of the number of such permanent full-time employees projected in the project proposal, this shall be deemed a material variance for the purpose of a revocation determination. Upon such a revocation, all tax credits available to the controlling business as a result of project certification shall be revoked and forfeited for the year in which revocation occurred and all subsequent years, and the commonwealth, and the municipality, in the case of a certified expansion project, shall have causes of action against the controlling business for the value of any economic benefit received by the controlling business prior or subsequent to such revocation.

Revocation shall take effect on the first day of the tax year in which the material variance occurred, as determined by the EACC.

The revocation of a project certification shall not revoke any benefits due to the project that relate to years prior to the year in which the revocation determination has been made unless the controlling business has not proceeded with the certified project or unless EACC determines that the controlling business made a material misrepresentation in its project proposal, or failed to act in good faith to create and maintain the jobs described in its project proposal. In any such case, both the commonwealth and the municipality shall have causes of action against the controlling business for the value of any economic benefits received subsequent to the date on which the material misrepresentation was made. The commissioner of revenue may, consistent with this paragraph, disallow or recapture any credits, exemptions or other tax benefits allowed by the original certification under this section. The department of revenue shall issue regulations to recapture the value of any credits, exemptions or other tax benefits allowed by the certification under this section.

Annually, not later than the first Wednesday in December, the EACC shall file a report detailing its findings of the review of all certified projects that it evaluated in the prior fiscal year to the commissioner of revenue, to the senate and house chairs of the joint committee on revenue and the senate and house chairs of the joint committee on economic development and emerging technologies.

(c) The EACC shall evaluate and either grant or deny a project proposal within 90 days after its project proposal date and failure to do so by the EACC shall result in approval of the project for a term of 5 years. Approval of a project under this section shall not constitute an approval by the EACC of any tax incentives provided for under chapters 62 and 63.

(d) The EACC may award to a certified project tax credits available under subsection (g) of section 6 of chapter 62 and section 38N of chapter 63. The amount and duration of any such credits awarded shall be based on the following factors:

(i) for expansion projects:

(A) the degree to which the project is expected to generate net new economic activity within the commonwealth by generating substantial sales from outside of the commonwealth, or otherwise;

(B) the degree to which the project is expected to increase employment opportunities for residents of the project ETA, if applicable, and of the commonwealth; and

(C) the economic need of the project ETA as measured by the income and employment levels of the ETA, if applicable;

(ii) for enhanced expansion projects:

(A) the degree to which the project is expected to generate net economic activity within the commonwealth by generating substantial sales from outside of the commonwealth, or otherwise; and

(B) the degree to which the project is expected to increase employment opportunities for residents of the commonwealth;

(iii) for manufacturing retention projects:

(A) the degree to which the project is expected to generate economic activity within the commonwealth by generating substantial sales from outside of the commonwealth, or otherwise; and

(B) the degree to which the project is expected to retain or increase manufacturing employment opportunities for residents in the project gateway municipality and the commonwealth.

(iv) for job creation projects:

(A) the degree to which the project is expected to generate net economic activity within the commonwealth by generating substantial sales from outside of the commonwealth, or otherwise;

(B) the degree to which the project is expected to increase employment opportunities for residents of the commonwealth; and

(C) the degree to which the project qualifies for certification as an expansion project, an enhanced expansion project or a manufacturing retention project, with the expectation that the EACC will certify a proposed project as a job creation project only if the proposed project does not otherwise qualify for certification.

(e) The EACC may limit any incentive or credit available to a project pursuant to subsection (g) of section 6 of chapter 62 and section 38N of chapter 63 to a specific dollar amount or time duration or in any other manner deemed appropriate by EACC, including limits or restrictions on the right of the controlling business to carry unused credits forward to future tax years.

(f) If a municipal project endorsement includes an offer by a municipality to provide the certified project with tax increment financing, said binding written offer shall contain a tax increment financing agreement adopted in accordance with section 59 of chapter 40. The EACC may approve such tax increment financing plan pursuant to regulations adopted by the EACC. Any such approval shall include a finding, reflected in the EACC's minutes, that the tax increment financing plan complies with said section 59 of chapter 40 and will further the public purpose of encouraging increased industrial and commercial activity in the commonwealth.

(g)(1) If a municipal project endorsement includes an offer by the municipality to provide the certified project with a special tax assessment, the municipal project endorsement shall include a binding written offer setting forth the following assessment schedule for each parcel of real property in and on which is located and which is otherwise a part of a certified project:

(i) in the first year, an assessment of 0 per cent of the actual assessed valuation of the parcel; provided, however, that such assessment shall be granted for the year designated in the binding written offer;

(ii) in the second year, an assessment of up to 25 per cent of the actual assessed valuation of the parcel;

(iii) in the third year, an assessment of up to 50 per cent of the actual assessed valuation of the parcel;

(iv) in the fourth year, an assessment of up to 75 per cent of the actual assessed valuation of the parcel; and

(v) in subsequent years, assessment of up to 100 per cent of the actual assessed valuation of the parcel.

(2) For the purposes of this subsection, the ''municipality's fiscal year'' shall refer to a period of 365 days beginning, in the first instance, with the calendar year in which the assessed property is purchased or acquired by the controlling business or the calendar year in which the assessed property becomes part of a certified project, whichever last occurs; provided, however, that no such written offer from a municipality shall be considered to be binding as aforesaid until it is authorized.

(3) Notwithstanding any provision of this section to the contrary, a municipality may offer a special tax assessment to a controlling business without a certified project if: (i) the municipality makes a formal determination that the controlling business is making an investment that will contribute to economic revitalization of the municipality and will significantly increase employment opportunities for residents of the municipality; (ii) the municipality applies to the EACC for approval of the special tax assessment; and (iii) the EACC makes a formal finding, based on information presented by the municipality and incorporated into its minutes, that the special tax assessment is reasonably necessary to enable the controlling business's investment and will further the public purpose of encouraging increased industrial and commercial activity in the commonwealth.