Tewksbury Earns Economic Target Area Designation

If Economic Development Committee Chair David Plunkett has his way, the Curt Schillings of the world will soon be coming to Tewksbury, not moving out of state.

Schilling, the former Boston Red Sox star pitcher turned business owner, recently made headlines when he agreed to move his fast-growing video gaming company, 38 Studios, out of nearby Maynard and into Rhode Island. Schilling is pulling out of Massachusetts because the state of Rhode Island offered the former pitcher and his 38 Studios a package of loans and incentives that nobody in the commonwealth could match.

Plunkett and Steven Sadwick, the town's director of community development, Tuesday night announced that Tewksbury has been designated as an Economic Target Area (ETA) by the commonwealth of Massachusetts. The ETA designation allows Tewksbury to offer state-funded tax credits and locally approved Tax Increment Financing (TIF) to businesses interested in moving to Tewksbury, or existing Tewksbury business owners who are looking to expand their operations.

"This puts us on a level playing field with other competing communities," Sadwick said. "We're now able to offer tax incentives that we didn't have prior to this."

According to Plunkett, the ETA designation is a first step toward the town's goal of attracting "the right type of development."

"With this designation, you become a community that is not just a last resort for businesses," Plunkett said. "We're trying to put Tewksbury in the top tier and compete to get the types of businesses everybody wants."

The most desirable businesses, of course, are those that contribute significant tax revenue to the town, while creating a large number of new jobs, many of which would be filled by Tewksbury residents. In Schilling's deal with Rhode Island, the former big leaguer agreed to bring 450 new jobs to that state between now and 2012.

As important as the jobs is the non-residential contribution to the town's tax revenues. Tewksbury has experienced a prolonged period of increasing property taxes and town fees, coupled with cut-backs in town services.

If new businesses come to town, or existing businesses expand, the town will realize greater commerical tax revenues. And that's good news for Tewksbury's beleagured individual taxpayers.

"When you broaden the commercial tax base, you reduce the burden on the home owner," Plunkett said. 

The announcement should come as good news to existing Tewksbury businesses, as well. At present, when an existing business expands its operations, it must plan for an immeidate increase in its tax assessment, even though increased revenues from the expansion may not be realized for years to come. With the ETA designation, the town would be able to approve temporary tax relief for growing businesses, eliminating one road block that often delays growth.

"We would now be able to give them relief on the additional assessment over a period of time," Sadwick said. "We'll still be increasing future (tax) revenues, but it allows them to ramp up over a period of time. And rather than relocating elsewhere, they're here."

The ETA designation is the second such "merit badge" for the town's Economic Development Committee. Last year, the group helped the town earn the Gold Bio-Ready Community designation, given out by the Massachusetts Biotechnology Council. That designation put incentives in place for biotechnology businesses to come to Tewksbury.

"We're in a down economy, but we're making good use of the down time," Plunkett said. "Between the Bio-Ready designation and the ETA designation, we're putting ourselves in a position to be a destination of choice for businesses when the economy starts turning around."