State rep. set to join Healey's labor team reminds employers of disability tax credit
Photo | Courtesy of Commonwealth of Massachusetts
Massachusetts State House
A tax incentive program aimed at bolstering employment opportunities among people with disabilities needs more promotion, according to a state representative who is poised to join Gov. Maura Healey's labor team.
Rep. Josh Cutler asked a legislative subcommittee to help raise awareness around the Disability Employment Tax Credit, which allows employers to claim a credit equal to $5,000 for hiring a worker with a disability in their first year of employment -- or 30 percent of their wages, depending on which amount is lower. In subsequent years, employers can claim a credit of $2,000 or 30 percent of wages.
"I think one way the commission can be helpful is to help us promote that tax credit because it's only been on the books for ... really a couple of fiscal years. I don't think people are aware of it as perhaps they can be," Cutler told the Legislative and Budget Subcommittee of the Commission on the Status of Persons with Disabilities.
The tax credit program was approved in the fiscal 2022 budget, a Cutler aide said.
The incentive was recommended in a December 2020 report, produced by a WorkAbility Subcommittee initiative led by Cutler, that offered a raft of strategies for increasing employment for the disability community. The employment rate of people with disabilities was 38.2 percent in 2019, compared to 80.1 percent for people without disabilities, the report found.
Cutler asked the subcommittee to formulate a plan to educate employers about the incentive, making them "aware that they have a pretty generous tax credit they can take advantage of for hiring an individual with a disability and then keeping them on their workforce."
Gov. Healey on Friday tapped the Duxbury Democrat for a new role in the Executive Office of Labor and Workforce Development. Cutler, a six-term lawmaker and chair of the Joint Committee on Labor and Workforce Development, is slated to become undersecretary of apprenticeship, work-based learning and policy.
"Just to be clear, I'll definitely bring a disability lens to the work that we're doing, especially around apprenticeships," Cutler said as reflected on his career transition. "The Healey-Driscoll administration really wants to put a renewed emphasis on the apprenticeship model, the registered apprenticeship model."
Cutler had yet to submit his resignation as of Monday afternoon, according to the House Clerk's office. Cutler, asked about his last day in the Legislature, told the News Service said that date is pending health-related issues that will be addressed this week.
Imene Bouziane Saidi, program director for the commission, said subcommittee members are interested in analyzing the rollout of the tax credit so far and gauging "how we can fill in the gaps." The Massachusetts Rehabilitation Commission is implementing the program, she said, particularly in vetting applications for eligible employees with disabilities.
"One of the things I meant to do, and we just haven't done, is to get the data. I played a hand in getting it started, so I want to make sure that it flourishes," Cutler said, suggesting data could provide insights into how the program is performing across companies of various sizes or geographically throughout the state.
Cutler also advocated for more investment in Regional Employment Collaboratives -- composed of state agencies, employers and workforce development groups -- to reach unserved areas of the state and expand disability employment. The existing six collaboratives are funded by the Department of Developmental Services, according to the 2020 report.
"We saw that that was a really good model for encouraging and incentivizing disability employment practices," Cutler said. He added, "To add coverage to a particular area, it might be a few hundred thousand dollars. We're not talking about millions of dollars, so it's not a tremendous, tremendous ask when we're talking about the budget."
The environment for investments is changing. The Healey administration on Monday lowered the tax revenue forecast for this fiscal year by $1 billion, announced $375 million in spending cuts, and said it expects no state tax revenue growth for the fiscal 2025 budget.
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