On August 13, Governor Patrick signed into law an economic development bill designed to strengthen the state’s economy. The bill includes a number of provisions supported by the Chamber, including the creation of a state-level Financial Services Advisory Council, the preservation of current state policy on non-compete agreements, and the modernization of the state-level research and development (R&D) tax credit.
The Chamber proposed the creation of the Financial Services Advisory Council last year as a means to advance the competitiveness and leadership of the state’s critical financial services industry. The financial services industry has long been a pillar of the Massachusetts economy—providing jobs, investments, tax revenues, and significant civic leadership—yet has recently faced growing domestic and international competition.
The Financial Services Advisory Council will advise the Governor and function as a liaison between senior state government officials and key industry leaders. Its goal will be to advance hiring, investment, and the overall competitiveness of Massachusetts’ financial services industry. The Council will convene a minimum of three meetings per year to exchange ideas and develop strategies that leverage existing government resources, personnel, and infrastructure to strengthen and advance the industry.
Additionally, the economic development bill maintains Massachusetts’ policy on non-compete agreements; which the Chamber worked to preserve. Proposals to ban or severely restrict those agreements had been advanced during debate on the bill. Non-compete policy in Massachusetts is well developed, and its usage on a voluntary basis by both employers and employees is well established.
The bill also modernizes the state’s R&D tax credit. The credit had become outdated and cumbersome, penalizing some companies with significant investment in Massachusetts. The bill allows for the election of an alternative simplified credit, which will benefit a greater number of businesses and incentivize new R&D spending.
The Chamber will continue to work with business leaders, other business groups, and state government leaders to implement the bill and strengthen the Massachusetts economy.