Monday, February 4, 2008

Bio bill backers respond to Beacon Hill pushback

By Ryan McBride

Massachusetts economic development chief Daniel O'Connell says state officials have answered legal questions about supporting corporate projects through Gov. Deval Patrick's $1 billion life sciences initiative.

Lawmakers questioned the legality of using public bond proceeds for capital projects that benefit individual companies during a Jan. 16 hearing on a $500 million bond to fund capital projects for life sciences companies over the next 10 years.

"We have done legal research which we are making available to the (Joint Committee on Bonding, Capital Expenditures and State Assets) ... on the use of public bond funding for these purposes. There's quite a bit of precedent and really no legal question," said O'Connell, secretary of the state Executive Office of Housing and Economic Development, in an interview last week.

O'Connell said he met with state Rep. David Flynn, the bond committee's chairman, last week to talk about the $500 million bond, which provides the capital portion of the $1 billion initiative. The governor's office also gave Flynn and the committee a copy of a previously unavailable letter the state had sent to British drug maker Shire PLC last year in which the state offered more than $40 million in support for the firm's proposed expansion in Lexington.

The bond is intended to fund several capital projects proposed by the University of Massachusetts as well as to fund infrastructure to support the expansions of life sciences firms here. State officials have already talked about using proceeds of the bond to aid Genzyme Corp., Organogenesis Inc., and other companies.

Patrick and other top state officials hope the bill passes by the middle of this month.

Genzyme and Organogenesis have both begun expansions with the hope that the life sciences bill passes. In January, Cambridge-based Genzyme said it would start this month on a $250 million expansion in Framingham. The project requires upgrades to Framingham sewers, which a company official estimated would cost $1 million to $2 million, most of which would come from the life sciences bond.

Patrick's office has also crafted a $12.9 million package to aid in the expansion of Organogenesis, a maker of skin-replacement treatments, but the aid is dependent upon the passage of the life sciences bill, according to a spokeswoman for the state economic development office. Organogenesis last month began to move into a newly acquired building in Canton, near its headquarters. Organogenesis CEO Geoff MacKay has said the building is intended to serve as temporary space while the firm hunts for a larger facility in the state and awaits expansion aid from the life sciences bill.

Meantime, Shire spokeswoman Jessica Cotrone declined to provide details on the status of the company's planned $350 million expansion of the firm's Human Genetic Therapies unit in Lexington.

Like other companies and organizations in line for funding from the bill, Shire has been reluctant to complain about the long wait for its passage.

Ranch Kimball, the former head of economic growth under Mitt Romney, and now president and CEO of Joslin Diabetes Center in Boston, said he has supported the passage of Patrick's life sciences bill and would say only that he believes it is important to the economic future of the state.

"It really helps make Massachusetts more competitive," Kimball said.