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March 5, 2020

Lamont touts shift in biz incentives ahead of DECD audit

Photo | CT Mirror/JENNA CARLESSO Gov. Ned Lamont during his second State of the State speech in February.
By Matt Pilon

Gov. Ned Lamont on Wednesday touted Connecticut’s new strategy for doling out business incentives to a room full of private-sector leaders, some of whom complained about the cost and regulatory roadblocks of operating in the state. 

“We spent the last eight years saying ‘hey Amazon, please come to the state, we’ll pay you millions of dollars in interest free loans and up-front grants,’ ” Lamont told the crowd at the State Capitol who were attending the Connecticut Business & Industry Association’s annual Connecticut Business Day event. “And what we’re doing is moving away from that.”

While Lamont was referring to Connecticut’s failed pitch several years ago to attract an Amazon headquarters to the state, his comments also characterized the First Five Plus program, a key incentive launched by his predecessor and fellow Democrat Dannel P. Malloy.

Hours after Lamont’s comments, that program came under fire from state auditors, who issued a report faulting DECD for ignoring or misinterpreting state law in doling out tens of millions of dollars worth of incentives to attract or keep companies in the state.

Lamont made no reference Wednesday morning to the pending release of the audit, which covered fiscal years 2015 and 2016 -- several years before he was elected.

He said smaller manufacturers who are part of defense and aerospace supply chains have told him the big, up-front deals were unfair.

“They were the ones kind of teed off with all the money we were throwing at companies, because then these out-of-state [companies] would maybe come in and start taking some of their local employees,” he said.

Lamont said DECD is now focused on incentivizing more modest job growth from companies. Firms that create 25 jobs will receive a credit on their payroll tax. Companies that create jobs in cities will get a bigger incentive.

There have also been changes to the Small Business Express program and other incentives, though not everything has changed.

Smaller deals are far cry from First Five packages, which often ranged from $10 million to $20 million.

“It’s good for small businesses here in Connecticut, not just the big out-of-state folks we were previously trying to recruit in,” Lamont said of the changes.

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