iRobot plans move to Bedford
Tax incentives keep it in Mass.
Local and state tax incentives have prevented a multimillion-dollar Massachusetts company and hundreds of jobs from crossing the border to New Hampshire.
iRobot will be moving its headquarters across the town line from Burlington to Bedford as soon as next year. A move to Jaffrey, N.H., was ruled out, in part due to a tax credit program that was crafted by state officials, local representatives, and company management. Bedford voters will be asked to approve that financial plan at Town Meeting on Nov. 5.
Paul Tavalone, iRobot's vice president and assistant treasurer, said that after an extensive search that included not only Burlington and Bedford but also Tewksbury, Kingston, and Jaffrey, the company settled on a 158,000-square-foot space at 8 Crosby Drive in Bedford.
A major reason for the move was the company's need for more space. One ele ment that sweetened the deal, Tavalone said, was an agreement with the state Highway Department to lease 1.7 acres of nearby land to test the robots that the company has been shipping to Iraq and Afghanistan for the military.
Kofi Jones, spokeswoman for Housing and Economic Development Secretary Dan O'Connell, said officials did their job in keeping a growing high-tech company in the Commonwealth.
"We work with companies to ensure that they stay here in Massachusetts. When we learn about companies that are considering moving outside, we work hard to make sure they stay here, grow here, and move here," said Jones.
Richard Reed, the town administrator in Bedford, said the tax agreements were recommended by the state in a preemptive move to keep big companies and jobs in Massachusetts. For Bedford, the deal makes sense because the space is now vacant, Reed said.
"I don't see the town of Bedford as luring people away from neighboring communities but working with the state government to retain the businesses within the Commonwealth of Massachusetts," said Reed.
Jones agreed that "it is in the state's best interest for companies to remain here. We don't view it as pitting one municipality against another, but competing against other states and other countries. We'd rather look at it in terms of what's best for the Commonwealth than one versus the other."
Burlington Town Administrator Robert Mercier said his community has no hard feelings about iRobot crossing the border to Bedford.
"This site was tailor-made for them," said Mercier. "We think it is great that a company like iRobot is staying in the region. We knew of their growth, had been in contact with them about it, and just couldn't come up with the kind of building that they need here in Burlington."
The iRobot deal is the third time Bedford has used a tax increment financing benefit, or TIF. The town also has agreements with
Reed said Bedford, the state, and iRobot have all been equal partners in brokering the current deal. The company will also get state tax incentives.
iRobot creates robots that do such things as assisting troops in Iraq and helping with household chores. Last year, the company reported revenues of $189 million.
Over the next 12 years, iRobot plans to lease space at the Bedford Business Park near the intersection of Routes 3 and 62. The new corporate headquarters is owned by
Currently, iRobot has offices at 63 South Ave. in Burlington.
Tavalone said the larger facility would mean, over the next 10 years, the company would grow from approximately 400 employees to 650 and make approximately $13.4 million in investments to improve the site.
"There is a high likelihood that we will pursue an expansion of additional space on site," said Tavalone.
Reed said the site is valued at $27.3 million. iRobot would occupy 33 percent of the space, which is valued at $9 million. Based on numbers generated from financial consultants, the overall value of the property is expected to increase between 28 and 38 percent, meaning Bedford could see between $900,000 to $1.2 million in additional tax revenue over the next 12 years.
Town Meeting will decide if a TIF will be assessed to the site. A TIF is a tool used by municipalities to attract businesses by reducing new property taxes generated from significant site improvements. The tax reductions are not permanent, but in this instance are needed for iRobot to qualify for investment tax credits from the state.
The local TIF would mean a cost savings to iRobot of between $58,000 and $80,000 over the next 12 years.
The project also qualifies for the state's Economic Development Incentive Program, which is aimed at generating improvements to "economic target areas," such as the one that includes Bedford. Under that plan, iRobot is eligible for personal property tax exemptions on the increased value to the property from the planned site improvements.
Jay Donovan, a financial consultant hired by Bedford, said the agreement makes sense for the town to attract business for the long term. Selectmen also unanimously supported the idea, and believe allowing the tax credit will be beneficial to the community.
"The state has been pushing this project for a while, and I am very interested in making sure that it happens," said Selectwoman Cathy Cordes. "I think that it meets everyone's needs."
According to Tavalone, if Town Meeting approves the plan, iRobot intends to begin an aggressive timeline for site improvements. Renovations will begin in December, and employees are expected to move in as soon as April 2008.
Over the last five years, iRobot has produced a number of household robots, including the Roomba and Scooba, which sweep and wash floors. The company has recently launched Looj, a robot that cleans leaves out of gutters, and Verro, which cleans and vacuums swimming pools.
iRobot also produces a line of tactical robots for the United States military that allow soldiers in Iraq and Afghanistan to identify and destroy bombs and provide surveillance. A new line of robot, which was built in conjunction with John Deere, allows vehicles to be driven unmanned through dangerous territories.
Melissa Beecher can be reached at mbeecher@globe.com. 