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H 5562

An Act relative to economic development in the commonwealth

194th Legislature (2025-2026)

Massachusetts borrows about $426 million to fund a comprehensive program that boosts economic development through grants, incentives for AI/climatetech, workforce planning, and str

Passed to be engrossed - 148 YEAS to 2 NAYS (See YEA and NAY No. 231 )
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Bill Summary · H 5562

Overview

  • Bill: H 5562
  • Session: 194th (Massachusetts)
  • Jurisdiction: Massachusetts
  • Title: An Act relative to economic development in the commonwealth
  • Sponsor: House committee on Ways and Means reports recommending passage with amendments
  • Funding mechanism: General Obligation Bond authorization totaling $425,100,000
  • Purpose: Accelerate economic development, drive industry innovation, support job creation, and invest in infrastructure and climate-conscious economic initiatives. Declared an emergency law for immediate effect.

Main purpose and intent

  • Create and fund a comprehensive program to boost economic development across the Commonwealth.
  • Support private sector investment in new and expanding facilities, with emphasis on decarbonization, climate resilience, job creation, and geographic equity.
  • Promote innovation in AI, defense-related tech, life sciences, climatetech, robotics, and related sectors.
  • Strengthen workforce development and data-driven planning to sustain competitive wages and high-quality jobs.

Key provisions and funding allocations

1) Executive Office of Economic Development (EOED)
- 7002-8079: Capital grant program for private businesses constructing or expanding facilities; emphasis on:
- Reducing fossil-fuel heating/cooling and incorporating decarbonization measures
- Climate resilience in facility design
- Significant job creation
- Potential administration via Massachusetts Development Finance Agency or other quasi-governmental entities
- Geographic equity in grant awards
- Amount: $25,000,000

  • 7002-8080: Grants to develop/apply AI technologies in strategic sectors (life sciences, healthcare, advanced manufacturing, climatetech, quantum, defense tech, transportation, robotics)

    • May benefit public, non-profit, and private entities
    • Administered by several tech/biotech centers (MTPC, MLSC, MTDC, and CEC) at the secretary’s discretion
    • Amount: $75,000,000

  • 7002-8081: Capital grants for sites to host early-stage/high-growth ventures; geographic equity

    • Administered via EOED with possible contracts to MDFA or other authorities
    • Amount: $20,000,000

  • 7002-8082: Investments in capital assets/public infrastructure to promote growth, defense sector innovation (AI, cybersecurity, robotics, semiconductors, biosecurity, advanced manufacturing)

    • Administered by multiple centers/agencies as appropriate
    • Amount: $100,000,000

  • 7002-8083: Capital grants for food science/agriculture/related sectors; geographic equity

    • Administered via MDFA or other state authority
    • Amount: $10,000,000

  • 7002-8084: Competitive program via Massachusetts Technology Park Corporation for robotics R&D and related activities

    • NGOs, universities, and private entities eligible
    • Amount: $25,000,000

  • 7002-8085: Grants to cities/towns and regional organizations for downtowns, main streets, cultural districts, and walkable districts; includes at least $200k for 2027 Boston Calling security

    • Geographic equity
    • Amount: $25,000,000

  • 7002-8086: Grants to enhance arts, culture, and creative economy; public realm improvements; arts-related infrastructure

    • Geographic equity
    • Amount: $25,000,000

  • 7002-8087: Local economic development grants

    • Amount: $100,000

2) Housing and Livable Communities (EOHL)
- 7004-0092: Municipal grants and technical assistance to convert commercial properties into residential housing
- Amount: $50,000,000

  • 7004-0094: Veterans-supported housing initiative (in partnership with a qualified nonprofit; cap of $20,000 per eligible veteran per year)

    • Amount: $20,000,000

  • 7004-0095: Grants for remediation of former state-owned buildings for housing development; requires reporting on grants awarded

    • Amount: $50,000,000

Structural and statutory changes

  • Section 3: Amends Section 204 of Chapter 6 to adjust term limits for certain appointments (strikes 8-year cap language, enabling longer tenure in some contexts).
  • Section 4-6: Various housekeeping edits to terminology (e.g., references to “economic” rather than “housing” in certain sections) and repeal of Section 35FF of Chapter 10.
  • Section 7: Establishes a biannual labor market/workforce report; involves:
    • Secretary of Labor and Workforce Development with input from Education and Economic Development
    • Reports on job market status, 5-year needs, career pathways, and industry skill needs
    • Public posting and transmission to key legislative offices and committees
  • Section 8-9: Workforce planning and climate/tech-focused program provisions (training for planning boards; site plan review improvements)
  • Section 11-13: Major expansion and governance of life sciences incentives under Chapter 23I, including:
    • Cap on incentives: up to $40 million annually
    • Requirements for written agreements detailing jobs, commitments, and clawback/cure provisions
    • Recapture/rescission mechanisms for noncompliance
    • Finality of center decisions on certification/incentives; limited or no judicial review
  • Section 15-29: Reforms to climatetech investment/trust funds (Chapter 23J), including:
    • Replacing prior fund definitions with a “Climatetech Investment Fund”
    • Establishing a gridtech deployment advisory board to accelerate gridtech pilots and deployment
    • Cap on refundable jobs credits and related incentives, with written agreements similar to life sciences framework
  • Section 31: Gridtech deployment section details governance, board makeup (electric utilities, DOT, MTDC, etc.), and expedited waiver processes to advance gridtech
  • Section 32-36: Energy/utility financing and fund administration adjustments; mandatory charge reform
  • Section 42-45: Expanded zoning-related reforms to enable commercial conversion of underutilized properties, including:
    • Adaptive reuse incentives
    • 30-50 units per acre density with affordability requirements
    • Parking, infrastructure, and affordable housing considerations
    • Streamlined multi-agency site plan/permitting processes
    • Protections for religious property developments and related mitigation
  • Section 46-47: Site plan and zoning consistency provisions; alignment with commercial conversion norms
  • Section 48-51: Site plan review standards, timelines (90-day decision window; deemed approvals if no action; lapse provisions)
  • Section 52-56: Public-venture tweaks to MTDC and related enterprise funding levels
  • Section 58-60: New site plan and permitting provisions; transitional language for commercial conversion processes
  • Sections 61-69: Administrative and regulatory framework for the Massachusetts Technology Park Corporation (MTPC) to govern investments, board structure, and operations

Who and what is affected

  • Private businesses, non-profits, universities, and public entities engaged in:
    • Facility construction/expansion with decarbonization and resilience features
    • AI, life sciences, climatetech, defense tech, robotics, and related sectors
    • Early-stage/high-growth ventures and R&D activities
  • Municipalities and regional organizations through targeted grants for downtowns, open space, culture, housing conversions, and downtown vitality
  • Housing and community development sectors via municipal housing conversion grants, veterans housing, and remediation projects
  • Labor market and educational sectors via workforce planning reports and career pathway programs
  • Life sciences and climatetech companies receiving tax incentives/certifications with monitoring and clawback provisions
  • Gridtech and energy sectors via a new advisory board and expanded incentives for grid modernization and offshore wind initiatives
  • Massachusetts Technology Park Corporation and related state authorities that administer and guide these programs

Timeline and procedural notes

  • Authorized to spend through June 30, 2036
  • Biannual reporting on workforce and labor market needs (even-numbered years)
  • Life sciences and climatetech incentive programs subject to annual/company reporting and certification requirements
  • Site plan review provisions set concrete timelines (e.g., final action within 90 days; lapse after 3 years if no substantial use/construction)
  • Emergency designation: act deemed an emergency law for immediate effectiveness

Summary takeaway

H 5562 creates a multi-faceted, near-$426 million bond-backed program to spur Massachusetts’ economic development through infrastructure grants, technology-focused incentives, workforce planning, and streamlined zoning and permitting. It emphasizes decarbonization, climate resilience, innovation in AI and climatetech, and equity across regions, while expanding the state’s capacity to attract, develop, and retain high-impact industries and talent. At the same time, it introduces significant governance changes and compliance mechanisms for tax/incentive programs, including binding written agreements and potential recapture provisions.

Compiled from official sources — confirm details with the bill’s official record.

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