PROVIDENCE – R.I. Commerce Corp. on Wednesday unanimously approved $2.9 million in tax credits for Breeze Aviation Group, Inc., as part of its plan to create a hub at Rhode Island T.F. Green International Airport.
Under the 10-year tax-credit structure approved by Commerce’s board of directors, the company will have to create a minimum of 58 jobs in the first year, increasing annually to 116 by year five, according to Breeze spokesperson Aly Escobar.
The public meeting was chaired by Gov. Daniel J. McKee, who has touted Breeze Airways’ plan to create a base at T.F. Green in Warwick as an economic boon to the state, noting increased travel options “over and above” the jobs created.
The tax credits are part of the state’s Qualified Jobs Incentive program created to expand the workforces of companies doing business in Rhode Island. The program offers annual, redeemable tax credits to approved applications for up to 10 years. Credits can equal up to $7,500 per job created per year, “depending on the wage level and other criteria,” according to the Commerce website. One of the target industries identified for the program includes transportation, distribution and logistics.
“This is part of the destination marketing strategy that we have been absent from for years,” said McKee before the vote. “Most of our travel comes from out of [T.F.] Green and back.”
The Commerce Corp. Investment Committee forwarded the credits for a final vote during a September meeting. Breeze officials said that 116 of the total jobs created by the hub at T.F. Green, which will officially open in 2023, are associated with the tax-credit agreement.
The state announced the deal to create the base of operations with the airline back in August. Over a five-year period, the airline plans to grow its network to at least 20 routes, operating some 20 weekly departures by the end of 2023 and reaching 44 weekly departures by 2027. Breeze launched in May 2021 and began serving Providence two months later.
Overall, the T.F. Green base is slated to create between 200 and 250 full-time jobs, providing $6 million in tax revenue over a 12-year period.
Escobar declined to offer details on the new destinations Breeze is planning to offer from T.F. Green.
She said the jobs eligible for the state incentives would pay an average $96,600 salary for pilots, airplane mechanics and administrative personnel.
As part of its hub at Green, Breeze plans to house between six and eight aircraft there.
After the meeting, McKee spokesperson Matthew Sheaff reiterated the agreement rests upon Breeze hitting their targets. Each qualifying employee must have worked and paid state income taxes for a year to be applicable.
“If they don’t hit their benchmarks, they don’t get the tax credits for that year,” he said.
Under the terms of the agreement, after the five-year hiring threshold is met, Breeze will still be required to retain the 116 new jobs for an additional seven years, two years longer than the company will be eligible for the tax credits.
“They’ll have several years to ramp up to that 116 number,” said Adam Isaacs-Falbel, Commerce Corp. policy and special projects analyst. “But these credits are not paid out until the jobs are created and paying income tax in Rhode Island for a year.”
(Update: Adds terms of agreement, comment from Isaacs-Falbel)
