Republicans Continue To Express Skepticism On Jackson Labs Deal
Legislative leaders from both parties met with Gov. Dannel P. Malloy for more than two hours Tuesday and emerged with 90 percent agreement on the jobs bill, but they were still far apart on the $291 million deal for Jackson Laboratory.
“As unbelievable as it may seem we are getting closer to what looks like it could be a bipartisan jobs session understanding people may have disagreements with respect to Bioscience Connecticut,” Malloy said. “With that exception we’re darn close.”
By mid-day Wednesday Malloy said he expects the remaining 10 percent of the jobs bill will be agreed upon or not and details are expected to be made available at that time. The approval of $291 million in state funds for Jackson Laboratory will appear in separate legislation.
House Minority Leader Lawrence Cafero, R-Norwalk, described Jackson Laboratory as an “exciting project,” but “it’s a lot of money and we have unanswered questions right now.”
Some of those unanswered questions are related to how the deal is structured. Cafero said he’s asked the administration whether Jackson Labs can create 300 jobs in five years, and if so then why doesn’t the state retain the title to the building until they create the jobs. The current deal calls for more than 300 jobs to be created over 10 years. It includes a $192 million forgivable construction loan and $99 million for research.
“Is there some wiggle room in regards to the amount?” Cafero said. “Can we do less money in five years, then when they hit that amount trigger additional money? It’s about minimizing the risk.”
“People find it a very exciting idea,” House Speaker Chris Donovan said of the Jackson Labs proposal. “In my caucus everyone wants to be supportive and make it successful.”
Donovan said his members want to do their due diligence on the proposal which is why the Finance Committee is holding a hearing on it Thursday.
Sen. Minority Leader John McKinney, R-Fairfield, said he hasn’t polled his caucus and he knows individual members have questions about it, including him.
“I’m concerned we’re maybe rushing, but I can’t take a position on it until I know all the answers,” McKinney said.
He said he would like to know with 1,300 employees in Bar Harbor, Maine how many spin-off and indirect jobs have been created because of their presence there. There have also been questions raised about their attempt to build a lab in Florida.
McKinney said they negotiated with Florida for two and half years and he finds it hard to believe they would give up on Connecticut if lawmakers wanted a little more time to learn about the deal.
Last week, Rep. Rosa Rebimbas, R- Naugatuck, asked Jackson Labs Chief Financial Officer Charles Hewett that exact same question about the timing and if it could wait until the regular legislative session.
“I’m certainly not issuing any ultimatums,” Hewett said. “I will tell you that within the last week I’ve had three calls to say come to us if Connecticut doesn’t work out. Would we explore those? Start to explore those? If it looked like this was going to drag on we might.”
“Do I have the appetite to go through what we went through in Florida in Connecticut? Absolutely not. Is Oct. 26 an ultimatum? No,” Hewett replied.
The Democrat-controlled legislature and Democratic governor don’t need Republican support for the proposal to get it passed, but both have worked to obtain it.
At least one Republican believes the Democratic legislature is not asking enough questions.
“If this had been a deal proposed by one of the prior two governor’s we would have had 15 press conferences, public hearings galore, and the former attorney general would have had press conferences on it. Let’s be honest,” McKinney said. “The majority has said very little about this deal. If it had been proposed by Govs. Rell or Rowland we would have heard a lot.”
Democrats disagree. They say they are doing their due diligence and they are taking advantage of an opportunity to create new industry in the state.
PriceWaterhouseCoopers estimates personalized medicine that Jackson Labs specializes in is growing at a rate of 11 percent per year.
According to the Department of Economic and Community Development the deal with Jackson Laboratory will create 841 construction jobs and about 330 jobs over the next 10 years. It also estimated there will be about 4,000 “spin off” jobs created and 2,000 indirect service type jobs created as a result of the investment. Jackson Labs will be investing $800 million of its own money to build the 173,000 square foot research facility, which it will eventually own.
Economic Development Commissioner Catherine Smith said last week that the estimates are conservative. It’s estimated that 661 direct jobs will be created, but it only needs to create 300 by year 10 in order to have the loan forgiven.
“If the deal is that promising and we are spending a significant amount of taxpayer dollars to invest in bio-technology, then we should take our time and do our homework,” Sen. Leonard Fasano, R-North Haven, said. “Let’s see if this investment makes good business sense for Connecticut. Taxpayers deserve no less.”
Roy Occhiogrosso, Malloy’s senior adviser, said he can understand if the Republicans are opposing it for political reasons, but cautioned them not to reframe the issue by “picking out isolated facts.”
Occhiogrosso said they gave Republicans the opportunity to present them with their own economic modeling and they have yet to hear back. Occhiogrosso said they’d be happy to run the numbers in another economic modeling program.
He said the deal will make Connecticut an international leader in a growth industry, something that has never happened before.