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January 15, 2013

Panel agrees on tax breaks

Beverly: Subcommittee votes 2-1 to give mayor the ability to negotiate a lower rate

A City Council subcommittee last night backed Beverly Mayor Bill Scanlon in his effort to gain negotiating power with developers seeking a tax break.

The council’s Finance and Property Committee voted 2-1 at City Hall in favor of allowing the mayor to negotiate a tax break lower than the 70 percent that the City Council approved in November.

The change must still be approved by the full council, but the vote was a victory for Scanlon in the controversy over who should determine the size of the tax break, the City Council or the mayor.

“You totally tie the hands if you insist on a flat rate,” Scanlon told councilors during the meeting. “Don’t make bad policy because you’re afraid you’ll have a bad decision-maker.”

The council and Scanlon all agree that the tax breaks are needed in order to draw developers to Rantoul Street and bring vibrancy to the area around the train depot. Councilors voted unanimously in November to set a nonnegotiable tax break of 70 percent for the first five years and 30 percent for the next five years for developers who are accepted into the program.

But Scanlon used his veto power for one of the rare times in his 18-year tenure to overturn the law because he thinks the mayor should have the authority to negotiate a lower tax break rather than giving 70 percent for every project.

The matter went back to the council last night. And this time, Scanlon, who did not attend some of the council meetings where the issue came up before, was on hand to state his case.

Scanlon told councilors that giving every developer the same tax break regardless of the quality of the project was “absolutely dreadful policy.”

The mayor, in fact, said he would be willing to let the City Council negotiate the tax breaks if they didn’t want him to do it. He said the city needs to have leverage with developers in trying to get what will be the best project for the city.

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