April 25, 2018
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Jackson Lab and Maine

It is easy to say Maine should have done more to encourage The Jackson Laboratory to expand in Maine rather than Florida. There are two reasons this is a simplistic criticism.

First, the lab, which is based in Bar Harbor, plans to add jobs in Maine. CEO Rick Woychik says the company expects to add 200 jobs over the next five years in Maine, the same number of jobs it would create during that time at the proposed facility in Florida. Maine will get those jobs without spending the $260 million that Florida is contemplating.

In other words, having a Maine-based company expand elsewhere can strengthen its Maine presence — at little or no cost to the state.

It was revealed earlier this month that Jackson Lab is considering a major new genetics facility in Florida. A Florida Senate Committee has approved a $50 million earmark to help fund the facility. A total of $130 million in state money is expected. That would be matched with $130 million in local funds.

The second problem with the criticism is that it supposes Maine has to use the same tools as Florida to attract new business.

Maine has offered lower taxes, tax rebates, lower energy costs and other incentives to attract new business and encourage existing businesses to expand. It has never offered piles of cash. It if were to do so, the money would have to come from somewhere.

If the state did not give any existing companies the business equipment tax reimbursement for several years, it still wouldn’t have anywhere near the $260 million Florida governments are offering.

If the state raised the sales tax by a penny for two years and gave all the additional money to Jackson Lab, it still couldn’t meet Florida’s cash contribution.

In theory, lawmakers could take the money away from schools or health care service, but after the first public hearing where they faced angry teachers, students, parents and hospital CEOs, they’d quickly drop that idea.

The only way to come up with that much money would be through bonds, which have increasingly run into the Republican mantras that Maine is drowning in debt and that you can’t borrow your way to prosperity.

This paper, lawmakers, university officials and others have long begged the state to invest more money in research and development, because it pays huge returns. Maine for decades has been at the bottom in terms of state investment in R&D.

Large R&D bonds have periodically been introduced, only to be pared back and, as is tradition in Maine, cut into a dozen pieces so lots of projects get a little funding, but none get enough money to make a real difference.

To be useful, gubernatorial candidates who are criticizing the Baldacci administration for allowing Jackson Lab to open a branch in Florida must explain how they would rectify the supposed problem. Should businesses headquartered in Maine not be allowed to grow outside the state? If so how would he or she stop it?

If they support larger business incentive, where would they get money? Would they propose big bond issues? How would they get them through the Legislature?

More important, would they pick winners and losers? And, as a result, give tens of millions of dollars to one entity and none to the many others seeking state help? How would they decide who should get the money?

Without answering these questions — and acknowledging that Jackson Lab is growing in Maine — such criticism rings hollow.

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