THE FUTURE USS MICHAEL MONSOOR, one of three Zumwalt-class stealth destroyers built at Bath Iron Works, passes the shipyard’s floating drydock on its way to sea trials in January. A proposed $45 million tax credit benefiting the General Dynamics-owned facility has passed the Maine Senate and returns to the House.
The vote follows a similar action in the House yesterday, when the bill was approved 117-31.
Sen. Dana Dow, R- Waldoboro, introduced an amendment to the bill further clarifying that the recipients of the new tax credit could not also qualify for Pine Tree Development Benefits. That was an important point for the Taxation Committee, which Dow chairs.
The final amendment included language to that extent, but Dow’s amendment is intended to further clarify that point.
All three senators representing the Midcoast
— Sen. Garrett
Mason, R- Lisbon, Sen. Everett “Brownie” Carson, D- Harpswell, and Sen. Eloise Vitelli, D-Arrowsic — voted in favor of the bill.
“This bill is a workforce bill,” said Vitelli, a co- sponsor of the bill. “It is a jobs bill. One that will help protect good paying jobs for the future of our state.”
Carson said that while he came into the Wednesday session undecided, he felt that he needed to support the bill to support the shipbuilders of BIW.
Sen. Justin Chenette, D-Saco, who was the main opponent of the bill on Taxation Committee, urged his fellow lawmakers to reject the legislation due to the fact that the shipyard has not shown evidence of financial need, among other reasons.
“As a member of the Taxation Committee, I asked numerous questions to obtain baseline financial information,” Chenette told the Senate. “In fact, I asked ( on) five different occasions for financial information to determine financial need. The company refused to answer.”
Due to the amendment, the bill will return to the House for approval before being sent to Republican Gov. Paul LePage.
The latest version of the bill provides $45 million in non-refundable tax credits over 15 years, down from $60 million over 20 years, as originally proposed.
The shipyard, which employs 5,500 workers, says it wants to stay competitive against Ingalls, a Mississippi shipyard, as it bids for up to 20 frigates to supplement its contracts for larger destroyers. The shipyard has said it plans to use the millions of dollars that would otherwise go to the state to maintain its facilities and invest in its workforce.
Republican Sen. Dana Dow said he doesn’t know whether the shipyard or parent company, General Dynamics, needs the tax break, but said Maine must do what it can to help the shipyard win contracts.
“All we know is what the others states are doing,” Dow said.
Ingalls, which is a larger shipyard with twice as many workers, leases its land from the state for less than BIW pays in property taxes; receives millions in state bond money; and doesn’t have to deal with harsh winter weather, Bath supporters say.
“If someone’s not making you money, why would you hold onto them?” said Bath Iron Works production planner Logan Russell, a South Portland resident.
Several Democrats and Republicans praised the bill, including Democratic Sen. Troy Jackson who said he supported the tax credit because it’d support investment in Maine. Republican Sen. Eric Brakey, who is running for U.S. Senate, praised the bill for taking less money from Maine businesses.
Bill opponents including Chenette, who deemed it “corporate welfare.” Democratic Sen. Michael Carpenter asked how much General Dynamics would benefit from President Donald Trump’s tax cuts recently passed by Congress.
“Not every corporation needs a hand- out,” Chenette said. “Where is the line in the sand?”
Nathan Strout of The Times Record and the Associated Press contributed to this report.
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