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After four months of meetings, Worcester Mayor Joseph O'Brien's Task Force on Job Growth and Business Retention has issued a 30-page report containing sweeping recommendations for the city's economic development strategy, including narrowing the gap between residential and commercial/industrial tax rates.
The recommendations are broken into four categories: municipal staffing and organization; promoting a fair and equitable taxation system; business incentives and branding and marketing.
In addition to making recommendations for action on items like the city's two-tiered tax system and hiring additional personnel for the economic development department, the task force also made several conceptual recommendations.
Business owners who testified before the task force said city personnel was professional and easy to deal with personally, but navigating the municipal maze of business-related regulations, initiatives and programs is all but impossible.
In those cases, the city must ask itself, "How do we articulate what we already have?" O'Brien said during a meeting between several task force members and the WBJ.
Perhaps more directly, the task force recommends that the city close, or substantially narrow, the gap between tax rates for residential property owners and commercial/industrial property owners. Currently, the residential property tax rate is $15.15 and the commercial/industrial rate is $33.28. Yet, residential property owners pay about 80 percent of the city's total assessments.
By improving awareness among businesses of the various existing incentives available to them, as well as promoting and creating new incentives, the task force said it could make Worcester, especially downtown, more attractive to developers.
"The cost to do projects (in Worcester) is similar to Boston, but the rent you can get here is 40-60 percent of what it is in Boston," O'Brien said. "It's hard to close a deal when your only real tool is a TIF," tax increment financing, which typically gives developers tax breaks in exchange for the creation of a stipulated number of jobs.
Among the new incentives recommended by the task force is one that would create a zone in downtown Worcester that would provide projects with guaranteed incentives. That would take the need to lobby the city council for whatever they can get off developers' and property owners' to-do lists.
"The amount of the incentive is up for debate," O'Brien said. And the the guaranteed incentive program would require special state legislation.
O'Brien said the task force's report will be introduced to the city council over the next three months. The task force itself will reconvene in six months to formulate a progress report.
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Worcester Business Journal provides the top coverage of news, trends, data, politics and personalities of the Central Mass business community. Get the news and information you need from the award-winning writers at WBJ. Don’t miss out - subscribe today.
Worcester Business Journal presents a special commemorative edition celebrating the 300th anniversary of the city of Worcester. This landmark publication covers the city and region’s rich history of growth and innovation.
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