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Baker seeks $900m for growth plan
Goal is statewide economic success
By Jon Chesto
Globe Staff

Governor Charlie Baker’s administration filed a bill Thursday aimed at pumping more than $900 million into the state’s economy over five years and helping to spread the success the Boston area is enjoying to all corners of the state.

The bill calls for an infusion of funds into existing economic development programs and would help launch several new ones. It also includes some policy changes that would modify outdated rules — such as allowing qualified brewers to sell beer at farmers markets and exempting online retailers from paying time-and-a-half on Sunday for warehouse workers.

The money would come primarily through bond proceeds and not the state’s operating budget. As with other bond authorizations, this bill would give the administration the ability to spend borrowed money on these items, but doesn’t guarantee the spending will happen.

This marks the Baker administration’s first large-scale economic development bill, and it has been a work in progress since Baker took office a year ago. Typically, the Legislature approves such bills every two years or so, but they often take different forms and the spending amounts vary widely.

Baker and Jay Ash, the state’s economic development secretary, said these spending proposals should easily fit within a state cap on the amount of borrowed money it can spend annually, currently about $2.1 billion.

But Noah Berger, president of the left-leaning Massachusetts Budget and Policy Center, said it’s too early to know that for sure.

“This bill authorizes a lot of capital money for very good and effective programs,’’ Berger said. “The harder question, though, is making sure these priorities and other priorities all fit within the [state’s] allowable capital spending.’’

The biggest chunk of the new bill’s capital authorization — as much as $500 million over five years — would go to the MassWorks program, which provides infrastructure grants, often in places where multifamily housing is planned or employers are promising to expand. The bill also proposes a $25 million fund specifically for construction work needed to make a particular property attractive to developers.

There’s also a section aimed at innovation, including $118 million for grants to establish public-private research institutes focused on emerging manufacturing technologies — in an effort to help land matching federal grants. And it would set aside $25 million for capital grants that support local co-working spaces, to pay for things like equipment and parking ­facilities.

“From driving around the state, we’re seeing lots of communities where we think the greatest opportunity for economic growth is from within [those communities],’’ Ash said.

The bill further proposes $75 million for a new grant program for workforce development training equipment, a plan unveiled by the administration last week.

Another big change on tap: expansion of an existing tax incentive program that’s used to encourage businesses to add jobs in the state. The upgraded program could set aside an ­extra $20 million a year to land big, game-changing ­employers.

The bill is being filed with the Legislature at a time when the state’s economy, in many respects, is humming along: Massachusetts employers added more than 70,000 jobs in the past year, the strongest year-over-year gain since 2000. The state unemployment rate is 4.7 percent, below the national rate of 5 percent.

But Baker and Ash are aware that not everyone in Massachusetts is enjoying the fruits of a strong economy. ­Unemployment rates are higher in many of the state’s mid-size industrial cities, known by state officials as “Gateway Cities.’’ And there remains a significant mismatch between many employers’ needs — particularly among manufacturers — and workers’ skills.

This new jobs bill, to some extent, tries to address those disparities. For example, the legislation would set aside $50 million for the Transformative Development Initiative, a relatively new program aimed at revitalizing the Gateway ­Cities, places such as Holyoke, Brockton, and Springfield. The money would be used to help MassDevelopment, a quasi-public agency, invest in key properties in these districts.

“This is really a statewide investment, and I think that’s critical,’’ said Katie Stebbins, the state’s assistant secretary of technology and innovation.

Baker also wants to change state liquor laws. For example, he would eliminate a rule that prevents retailers from serving alcohol to diners if they also sell by the bottle. One company that could benefit is Eataly, the Italian food emporium that’s opening at the Prudential Center later this year.

Jon Hurst, president of the Retailers Association of ­Massachusetts, said he is ­frustrated that Baker declined to strike the portion of the “Blue Laws’’ that requires ­retailers with at least seven employees to pay time-and-a-half on Sundays. The bill, however, would allow online retailers — namely Amazon — to avoid the Sunday requirement at their warehouses.

“Disappointment is really the key word here,’’ Hurst said. “They know it’s our top issue. I understand it would be ­controversial, but it wasn’t so controversial that they couldn’t help out Amazon.’’

Jim Rooney, chief executive of the Greater Boston Chamber of Commerce, said he was happy to see a focus on improving housing options and on workforce training. But he noted there was nothing in the bill to support major transportation improvements, a critical priority for the chamber and other business groups.

“Maybe that’s a coming ­attraction,’’ Rooney said. “If there’s something notably ­absent . . . it’s what we’re ­going to do about that.’’

Jon Chesto can be reached at jon.chesto@globe.com. Follow him on Twitter @jonchesto. Joshua Miller of the Globe staff contributed to this report.