The Deval is in the Details
On Thursday, Governor Patrick handed his Beacon Hill colleagues the long awaited Life Sciences Initiative Bill (about which I have previously written on Xconomy.com). I am eager to see the bill though as yet I have been unable to obtain a complete version. Instead, I got a stripped-down, piece-by-piece summary of all 23 sections of the legislation along with a “Legislation for Amateurs” version of the entire proposal. I’m not much of a tax lawyer so the majority of its contents are lost on me.
The measure contains a wealth of tax exemptions, extensions, and refunds all intended to stimulate the private sector’s interests in making the Commonwealth home, especially in areas beyond Kendall Square (so-called “Economic Opportunity Areas”). A big part of the buy-in here relates to R&D or manufacturing businesses’ ability to be listed as a “certified life sciences project” by the state’s Department of Business Development. Getting this stamp means that they have to do some hiring of new, full-time employees within Massachusetts and in return, the company gets up to seven tax breaks/incentives including a full credit of the application fees paid to the U.S. Food and Drug Administration for products stemming from in-state R&D. Another break allows certified projects to extend their Net Operating Loss exemption as long as 15 years (it’s currently five). I’ve no way to know how tantalizing these carrots are going to be for businesses looking to relocate or expand in Massachusetts. What did get my attention was grant money for science.
Governor Patrick has said a great deal in the run-up to the bill about promoting basic life sciences in Massachusetts. There’s talk of a centralized stem cell bank as well as support for UMass-Worcester’s Professor Craig Mello’s Nobel prize-winning work with RNA-interference or RNAi. As yet I’ve seen no firm amounts described for either of these projects but as a scientist, it is at least encouraging to hear the buzz. The five member Massachusetts Life Sciences Center (MLSC), the group controlling the purse strings, would be increased to a membership of seven by adding two new gubernatorial appointees; one a venture capitalist and the other a researcher. The MLSC is chaired by the Secretary of Housing and Economic Development and will be advised by a yet-to-be-appointed ten-member committee drawn from the ranks of the Massachusetts Life Sciences Collaborative. The goal of all of this will be to craft a process in which the “MLSC has the authority to build capital projects, award grants, and expend funds consistent with the plan articulated by the Governor.” My own experience in helping to build a grants-awarding process drawing on state funds tells me that it is going to take a lot of work to get this off the ground.
That said, it’s also been my experience that things usually get done if people want them to. At this point, everyone involved (including the Governor) is waiting to see how this all flies in the 185th General Court of the Commonwealth. I would encourage folks under the gold dome to remember that now is not the time to rest on laurels. California has the green light on its $3 billion dollar stem cell package and development in the for-profit sector plays a significant part therein. The Massachusetts Life Sciences Initiative Bill is less money, but is broader in scope. Doing more with less is certainly challenging, but given the flexibility of being able to promote a wider-variety of life sciences companies and projects, it may ultimately prove to be a wiser approach.