MEASURE SEEKS CORPORATE ACCOUNTABILITY FOR STATE-FUNDED TAX BREAKS
“It’s time to say to Maine employers: do right by your employees if you want to qualify for state assistance.”
AUGUSTA –A measure that would set minimum standards in wages and benefits for employers that receive certain tax credits or state tax reimbursement received strong support in the Legislature’s Taxation Committee today.
Sen. Chris Johnson of Somerville
“This bill keeps job creation oriented tax breaks; but, it sets clear requirements for quality jobs to be created in return,” said Democratic State Senator Chris Johnson of Somerville, the sponsor of the measure. “When we give money in the form of tax breaks to employers who create jobs of poor quality, then taxpayers picking up the slack are hit twice.”
Sen. Johnson added, “It’s time to say to Maine employers: do right by your employees if you want to qualify for state assistance.”
The measure, LD 1287 “An Act To Ensure That Tax Expenditures Create High-quality Jobs,” sets minimum wage, benefit, health care, and scheduling standards for any business that utilizes tax spending programs such as the New Markets Investment Credit, Seed Capital Investment Credit, and Pine Tree Development Zones. Additionally, the bill requires employers to report their employment data to the Maine Revenue Services. The measure includes a clawback provision targeted at any business not in full compliance to remit back to the state a pro-rata amount of the tax credit or reimbursement.
“If employers want a hand-out to help create jobs, those jobs need to be quality jobs so their workers don’t need state help just to live from week to week,” said Senator Johnson.
Earlier this week, a Portland Press Herald investigation revealed an exploitation of a New Markets tax break by Cate Street Capital where after receiving $16 million in taxpayer dollars they shuttered the Great Northern Paper mill, forfeiting more than 200 jobs.
During his testimony before the committee, Sen. Johnson said, “I hope you are as angered by Cate Street’s rip-off of Maine people as I am. Without minimum expectations, reporting, and penalties, these programs will continue to be subject to abuse and unwise taxpayer investments in activities with little to no benefit to the people of Maine.
Joel Johnson from the Maine Center for Economic Policy, who testified in support of the measure said, “This is about fiscal responsibility and ensuring public dollars are spent wisely. This bill takes a step in the right direction.”
The Taxation is expected to hold a work session on the bill in the coming weeks.
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