TripAdvisor will save an estimated $2.75 million in taxes when it moves into a new office building in Needham, thanks to a deal negotiated by Business Development Strategies of Medway.
Have you ever bought something, only to realize later that there was a coupon you failed to take advantage of?
The feeling is bad enough when the purchase was dinner at your favorite Mexican restaurant (I could’ve saved 30 percent last Thursday!), but I bet it’d be just a bit more painful if it was, say, a $135 million office building.
Fortunately, the folks at TripAdvisor are better at redeeming coupons than I am. They got a discount worth an estimated $2.75 million on that new office, in the form of state and local tax breaks.
And they did it with the help of a Medway company called Business Development Strategies—a sort of coupon clipper for tax incentives. If you’re a business leader looking to expand your company, you may be vaguely aware that cities and the state sometimes offer tax breaks for that sort of thing. But you probably don’t know whether you’re eligible, and don’t know the first thing about securing money.
You’re in danger of missing an opportunity to save.
“Companies are intimidated by working with state and local governments,” BDS founder Lynn Tokarczyk told me, “because their expertise is running their business. They don’t know what buttons to push with officials.”
Tokarczyk, a former regional director in the Massachusetts Office of Business Development, helps companies identify potential rewards for building in economic target areas and creating new jobs. For TripAdvisor, BDS brokered a deal with the town of Needham that will reduce the company’s tax bill for 13 years when it moves in 2015 from Newton to Center 128, an office park in Needham that is being redeveloped. TripAdvisor signed the lease in June.
The key to any such agreement, Tokarczyk said, is to convince officials and residents that the company will deliver benefits to the community that make tax breaks worthwhile.
“If there’s hundreds of jobs,” she noted, “these hundreds of people will be spending at all the other local businesses—the delis, the hair salons, the fitness centers. And the company will use local service providers—landscapers, plumbers, car repair. That becomes very significant.”
There’s also the argument that some taxes are better than no taxes. Yes, Needham is granting TripAdvisor a discount, but officials estimate the town will collect $6 million more than it would if the company didn’t move there at all.
Other companies that have received tax incentives negotiated by BDS include L-3 Communications, CBM Industries, and Elite Envelope & Graphics. Tokarczyk and her team make the calls, fill out the paperwork, and develop the proposals.
Now, if only they could help with dining discounts.