Beacon Hill bids to boost business

Patrick said he will unveil a new $50 million tax credit for small business, a plan to make available $25 million in loans to small businesses, and a proposal to freeze unemployment insurance rates, which are set to rise April 1.

Murray said she will seek to streamline more than 30 agencies that promote economic development and create regional one-stop centers where all information about state programs and services will be available.

House Speaker Robert A. DeLeo said he supports the plans, indicating an emerging consensus from Beacon Hill’s top three leaders that they need to respond more forcefully to the economic crisis. The unemployment rate in Massachusetts climbed nearly a point in December, to 9.4 percent, the highest it has been since August 1976.

“It’s reached a crisis point,’’ Murray said in an interview. “We churn hundreds of thousands of jobs a year. If we’re going to recover from this economic downturn, we need to restore our job base and start creat ing new jobs.’’

Patrick echoed the sentiment.

“The simple point is: People need jobs and small businesses, historically, have added jobs first as a recovery begins,’’ he said in an interview. “If we’re going to recover, they need to start hiring, and these are elements to respond to their needs.’’

Patrick is proposing three new job-creation items. The $50 million tax credit would help fund up to 20,000 jobs by providing $2,500 for every new job created by a business with 30 or fewer employees, as long as that job is not eliminated within a year. The credits would be distributed on a first-come, first-served basis.

The second item is a freeze in unemployment insurance rates, which Patrick’s aides say will save businesses $158 per employee this year and a total of $391 million statewide. To ensure the state has enough money to continue paying jobless benefits, Patrick proposes to borrow an additional $391 million from the federal government this year. Patrick aides said the state has frozen unemployment insurance rates to alleviate the burden on businesses during past economic crises. The House last week approved a nearly identical freeze in the rates.

The governor is also proposing to merge three state agencies that provide credit for small businesses, pool their resources, and float a $25 million bond to make it easier for the new agency to provide small-business loans, equity investments, and loan guarantees to private banks that support small businesses. The proposal would merge the Community Development Finance Corporation, the Economic Stabilization Trust, and the Massachusetts Technology Development Corporation into a new entity, the Massachusetts Growth Capital Corporation.

Patrick said he is also considering ways to limit increases in health insurance premiums, by more aggressively wielding the state’s existing powers, and by asking the Legislature to give the state insurance commissioner greater power.

“It’s just choking a critical part of our economy and a critical factor in our recovery,’’ the governor said. Patrick plans to unveil his plans on Wednesday, in a speech to the Greater Boston Chamber of Commerce.

The first piece of the Senate’s plan seeks to streamline the more than 30 economic development agencies. With so many agencies doing the same thing, Murray said, businesses don’t know where to turn. Without the help they need, she said, they may move to another state or shut down completely.

“It’s taken us nearly a year just to figure out the mission of all these places and what they do,’’ she said. The Senate plan would merge six agencies - including the state’s Office of Travel and Tourism and the Massachusetts Film Office - into the Massachusetts Marketing Partnership. An unpaid board would oversee the partnership, making sure the agencies complement each other.

Several other agencies, including the state Department of Business Development, the Massachusetts Sports and Entertainment Commission, and the Massachusetts Industrial Development Authority, would be eliminated, saving taxpayers $1 million a year or more, Murray aides said.

To make it easier for businesses to navigate the state bureaucracy, the Senate bill would create regional one-stop centers for business information. The plan will also require that incoming governors file an economic development plan, setting forth performance goals, and form a commission to study the possibility of creating a state-owned bank.

At least one other state, North Dakota, has chartered its own bank, which has been freely lending money to businesses during the recession while other banks have not, Murray aides said.

The goal is to eliminate duplication and fill in some gaps in state agencies, Murray said. By combining agencies that focus on trade, for example, the state can formulate a single marketing theme, she said.

“Everyone knows ‘I Love NY,’ or ‘Virginia is for Lovers,’ ’’ Murray said. “Our message changes with each governor.’’

The Senate plan also takes aim at the quasi-public development agencies, which some charge have operated beyond the reach of other branches of government.

The bill specifically targets the Massachusetts Health and Educational Facilities Authority, which came under scrutiny after Patrick last year tried to place state Senator Marian Walsh into a high-paying job there. At the time, he said he was hoping to merge the agency with MassDevelopment, another quasi-public authority.

Murray’s plan does not go that far, but would require that another agency handle HEFA’s administrative functions, like payroll and legal services, and that the agency file annual reports and financial audits.

Patrick said he supports Murray’s plans.

“We’ve been working with the Senate president and the speaker on these and some other ideas as well, and we’re looking forward to working closely with them toward swift passage,’’ he said. “I know they share the urgency that we have in the administration, and that I have personally.’’

DeLeo said the plans from Patrick and Murray dovetail with proposals he outlined last week to fully fund workforce development programs; foster greater ties between vocational high schools, community colleges, and growing industries; and ensure that if the state legalizes gambling, it brings a guaranteed number of jobs.

Michael Widmer, president of the business-funded Massachusetts Taxpayers Foundation, praised the new efforts on Beacon Hill.

“Massachusetts is legendary for placing obstacles in the way of businesses seeking to preserve jobs, expand, or locate in the state,’’ he said. “Streamlining the byzantine process would be a critical step in improving the state’s business climate.’’