The Reminder and the Springfield Intruder both report this week on a controversy brewing over a proposed tax-incentive deal for Smith & Wesson.
Last week, the City Council was due to vote on the deal, which would save the gun manufacturer $600,000 in property taxes over a five-year period. In return, the company would keep an existing 822 jobs at its Springfield plant and add 225 new ones, as well as make a $14 million investment in improving the facility. The new Springfield jobs will come from a Smith & Wesson plant now in New Hampshire.
The city deal would come on top of a new state corporate tax break worth $6 million, given to Smith & Wesson on the name of economic development.
At their Jan. 10 meeting, councilors sent the property tax-break proposal to the Finance and Planning and Economic Development committees for further review. Councilor Tim Rooke is calling for that review to include an inquiry into whether Smith & Wesson made good on promises made as part of an earlier tax deal with the city. Under that agreement, reached during the Markel administration, Smith & Wesson committed to maintaining a workforce of more than 1,100 employees through fiscal 2002, in return for property tax breaks, the Reminder’s Mike Dobbs reports.
Rooke told the Reminder that he’s yet to see any of the annual reports Smith & Wesson committed to providing at the time showing that the company was, indeed, meeting the terms of the deal. If Smith & Wesson did not, in fact, meet those terms, Rooke contends the company should have to pay back the property taxes that were waived under the deal.
Over at the Springfield Intruder, writer Bill Dusty faults the Springfield Republican for giving short shrift to Rooke’s concerns in a Jan 11 article by Peter Goonan. “Readers were left to largely ponder–or dismiss–what exactly Rooke was talking about on the matter,” Dusty writes.
Dusty quotes Rooke calling these kinds of tax-waiver deals “useful economic development tools. … When executed properly and in good faith they are beneficial to the communities and the companies. When they are not executed properly and favor one side but not the other, and businesses fail to meet their obligations, it is called Corporate Welfare.”
