NEWS

Mass. Market: State slow to dole out grants in program’s first year

Jon Chesto

The executives at Granite Telecommunications thought they had found a solution to their parking woes when they were awarded a $3.5 million state grant a year ago under a new economic development program.

Granite pledged to add as many as 100 jobs at its North Quincy headquarters. In return, the state money would be used by the city of Quincy to subsidize a new parking garage at the site.

A year has passed, and Granite has added those jobs. But Sam Kline, a vice president at Granite, says the company is still waiting for the state to live up to its end of the bargain. He had expected construction would begin on the garage before this summer, but now he has no idea when the work is going to happen.

This month, Gov. Deval Patrick and his top aides are spreading word across the state about the winners in the second round of the state’s MORE grants, such as $1.3 million for a biomass-fueled power plant in Fitchburg and $1 million for infrastructure work at a Raynham corporate park. In all, about $24 million will be awarded to 20 communities in this round, says Greg Bialecki, Patrick’s undersecretary for business development.

But the state still has only doled out an estimated $3 million from the $76 million in grants that were awarded a year ago in round one.

In concept, the Massachusetts Opportunity Relocation and Expansion program is a good idea, a responsible investment in public infrastructure that can offset the cold cash that companies would need to spend on an expansion. The Legislature in 2006 set aside $90 million to get the MORE program off the ground as part of a broad economic stimulus package. The Patrick administration picked more than 20 recipients soon after taking office last year to reward companies that promised to add jobs here.

However, it’s taking a long time for that money to trickle into the economy.

In some cases, state funding didn’t materialize because the projects were either abandoned completely – like Boston Beer’s proposed Freetown brewery – or are now on shaky ground – like the massive Columbus Center complex that Winn Development proposed for Boston’s South End.

Then you have companies like Granite who are following the initial game plan. Granite employs about 625 in North Quincy, including some temp workers, up from about 500 a year ago. Fortunately for Granite, Kline says the company can lease 100 spaces at a restaurant across the street and has seen high gas prices cause more workers to take the T. But Kline says long-term growth at the site will be difficult without the 350-space parking garage, which will cost at least $8 million.

Dennis Harrington, Quincy’s planning director, says one major hold-up in Granite’s case is the fact that the MORE projects are subject to the public bidding process, even when the bulk of a project’s cost comes from private funds. He says the city needs to issue a request for proposals for the garage’s design, even though it has already been designed.

Another factor that slows down the distribution of the MORE funds is the stipulation that the towns are only reimbursed for work as the construction is completed. Kathleen McCabe, a contractor working with Eurovest Development for its Waterfront Square project in Revere, says no money has been released for that project from the $10 million MORE award that was announced a year ago. But McCabe says the 1.3 million-square-foot, multi-use project is still in the permitting phase. She expects the state money will start to flow once construction starts by the end of the year.

Bialecki says the state will distribute about $30 million in MORE grants in the fiscal year that begins in July. He expects that will be a more normal pace for the grant distribution as construction accelerates on many of the projects. He says the $3 million number may seem low for the first year so far, but it reflects the time necessary for officials to review detailed applications and distribute project contracts.

The MORE program still can provide an important tool for the Patrick administration to keep and retain jobs during an uncertain economy. We need to remain competitive with states such as North Carolina that are practically throwing money at companies’ expansion projects. And it makes sense to have strict controls on the money so taxpayer dollars aren’t disappearing into the black holes of failed projects or being pocketed by well-connected developers.

That said, Granite’s long wait may send a cautionary message to other local businesses that want to turn to the state for help: The wheels of government bureaucracy can move slowly, and if you want something done quickly, you should simply do it yourself.

Jon Chesto is the business editor of The Patriot Ledger. He may be reached at jchesto@ledger.com.