USA: Boston Beer Co. gets a tax increment financing (TIF) agreement

Voters at last night's special Town Meeting overwhelmingly agreed to give a tax increment financing (TIF) agreement to the brewer of Sam Adams beer, opening the way for a brewery in Freetown, The Standard Times posted June 13.

The decision, made by a clear majority of the roughly 298 residents in the Freetown Elementary School gymnasium, clears a major hurdle for Boston Beer Co.'s plan to open a 200,000-square-foot brewery in Campanelli Business Park.

The $90 million project is expected to create 75 new jobs when it opens. The starting production capacity is estimated at 700,000 to 1 million barrels of beer per year.

The facility would operate 24 hours a day, brewing most of the 18 varieties of Sam Adams beer.
Boston Beer CEO Martin Roper said the project is still contingent on tying the property into the Fall River water and sewer systems and securing the applicable building permits in a timely fashion. If those elements fall into place, the brewery could open in the summer of 2008, Mr. Roper said.

Mr. Roper said he hopes to have the water and sewer agreements with Fall River finalized within a week.

Boston Beer spokeswoman Michelle Sullivan said none of the other municipalities the brewer has been negotiating with for a new plant has reached agreement on a TIF.

Selectman Lawrence N. Ashley, who acted as the selectmen's liaison with Boston Beer Co. in crafting the TIF, said the brewery is the best plan that has arisen for Campanelli Business Park, which has rail access and is located right off Route 24, since the area was zoned for industry in 1996.

"It's been a long time coming," he said. "We're looking forward to having a company like Boston Beer locate in Freetown."

The voters' decision to approve the TIF came after a 90-minute presentation and discussion period in which one resident tried to amend the agreement's tax-break grid while others critical of the deal attempted to table it for further discussion.

The official TIF agreement still needs to be ratified by the town and Boston Beer Co., then presented to the state's Economic Assistance Coordinating Council for official approval when the EACC meets June 29.

The Boston Beer TIF averages 33 percent in annual tax breaks over a 20-year period. The TIF would be front-loaded, with 80 percent tax breaks in the first two years to help defray building costs and establishing brewing operations in town.

Based on the town's commercial tax rate of $14.81 per $1,000 of property value, Boston Beer would save approximately $1 million in taxes while the town would receive $2.75 million to $3 million in building and real estate property tax revenues.

"I think the TIF will benefit the town in the long run," Selectman Lisa A. Pacheco said.
The Finance Committee, however, did not think so, and voted last Wednesday 5-0 to recommend voters not approve the TIF.

Finance Committee Chairman David Theriault last night recounted the committee's criticisms of the proposal, which he said lacks adequate safeguards to prevent Boston Beer from requesting future abatements or ensuring the company gives hiring preference to Freetown residents.

Mr. Theriault said he was also concerned with the area's water capacity and the turning of trucks onto Ridge Road, which he said is not wide enough now to accommodate the trucks turning from Exit 9 on Route 24. He suggested that Boston Beer pay for reconfiguring Ridge Road, adding that it would be a "positive first step."

The Finance Committee "does not oppose any new development of new businesses, but we want to protect Freetown from any future developments that could harm the town," Mr. Theriault said.
Resident John McSweeney, an accountant, presented an amendment to the TIF that would have mandated Boston Beer pay an annual sum of $45,000 for a "Boston Beer Company Fund" that would be used for "worthwhile community needs."

Mr. McSweeney's amendment also included reducing the agreement's tax breaks to 50 percent in the first year, 40 percent in the second, and 30 percent in the third year, dropping below 5 percent for the entire second half of the TIF.

Town Moderator Bruce W. Wilbur did not allow Mr. McSweeney's amendment because he said it would significantly alter a warrant article that had already been posted and discussed in two previous public meetings. Following Mr. Wilbur's ruling, former Finance Committee member George Grunwald, who criticized the TIF as a bad deal, motioned to table the article. The motion to table was defeated 173 to 121.

Freetown School Committee member Jeanne M. Tierney also came out against the TIF after arguing the tax breaks to Boston Beer would negatively impact the town's share of Chapter 70 state education aid.

"For the residents and for the children, please vote no on this TIF," Ms. Tierney urged voters.
Ms. Pacheco, a former School Committee member, followed by reading a letter from State Sen. Joan M. Menard, D-Fall River, declaring that a TIF has no negative effect on a municipality's Chapter 70 share.

"The concerns brought forth tonight will be discussed when the selectmen meet with Boston Beer Wednesday night to work out the legal document," she said. "The Board of Selectmen will always look to do what's best overall for the town."

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