Connecticut Gov. Dannel Malloy was scheduled late Thursday to sign a jobs bill that called for nearly $1 billion of bonds, including a controversial $291 million to help genetics research concern Jackson Laboratory build a $1.1 billion center at the University of Connecticut Health Center.
“I’m proud of what we were able to accomplish,” Malloy said after the House and Senate passed extensive legislation enabling the state to issue $626 million of bonds to fund business loans, repair of state bridges, assistance for small businesses and tax credits for new hires.
Separately, the General Assembly authorized $291 million in state borrowing for Bar Harbor, Maine-based Jackson Laboratory, which plans to construct a research center for personalized medicine and systems genomics.
The 173,500-square-foot building would be built on 17 acres of state-provided land at the UConn Health Center in Farmington, a Hartford suburb.
The funding package consists of $192 million in a secured construction loan and $99 million in research partnership participation.
For every $1 Connecticut is spending on this project, Jackson Laboratory will spend $3, according to the governor’s office.
“By combining Jackson’s strengths in genetics and genetic technologies with the clinical and scientific expertise of Connecticut institutions, we will accelerate the development of new medical tests and treatments tailored to each patient’s unique genetic makeup,” said Jackson chief executive officer Edison Liu. Yale University will also be involved with the project.
Malloy has placed a priority on attracting biotech jobs, as have many other states.
But some lawmakers thought the funding package was too generous. “It’s a step in the right direction, but it comes with an expensive price tag,” said Sen. L. Scott Frantz, R-Greenwich.
“If this were an economic development deal, along the lines of, say, $20 million to $30 million, I’d be jumping up and down,” he said. “Granted, this is a more sexy industry and a higher-growth industry. I’m very excited at the prospects of Jackson Labs coming to the state. They do outstanding world-class research. However, like anything else, you have to make sure that the right price is associated with the right kind of deal and the right kind of potential return down the road. ... We gave them the building.”
According to a statement from Malloy, a Democrat, permanent jobs associated with the facility total more than 6,800 over 20 years, including 300 direct jobs within 10 years.
Rep. Jeffrey Berger, D-Waterbury, said the funding package was necessary for job growth in a state where the unemployment rate has hung around 9%.
“Components of the bill include reducing taxes to help stimulate the economy as well as creating educational opportunities to prepare our workforce for tomorrow’s demands,” he said.
Moody’s Investors Service this week assigned an Aa2 rating and negative outlook to Connecticut’s general obligation new-money and refunding bonds, totaling $715 million and affecting $14.7 billion of outstanding debt.
A sale is expected next week of $550 million of Series 2011D new-money and $165 million of Series E refunding bonds.
“The Aa2 rating incorporates our expectation that Connecticut’s revenue trends should improve as it emerges from the recession, and the state will maintain its new commitment to structural budget balance and addressing its negative GAAP basis unreserved undesignated general fund balance,” Moody’s said in a report issued Wednesday night.
Challenges for the state, Moody’s said, include fixed costs for debt, pensions and other post-employment benefits, which relative to the budget are among the highest in the nation. The rating agency also cited Connecticut’s low funding ratios for pension systems.
