A new set of business incentives proposed to replace Maine’s long-standing Pine Tree Development Program would attract investment and address significant workforce shortages, Auburn’s economic development director told lawmakers Friday.

Jay Brenchick said he’s worked in other states, including New Hampshire, and knows that companies are often confused by business incentives offered in Maine.

But he said the proposed Dirigo Business Incentives Program — which offers tax credits for capital investment and a worker training tax credit — is a big improvement.

“This is just completely a common-sense approach,” he said. “It supports our industries. It supports job retraining.”

The Dirigo program, which is proposed in LD 1918, is designed to replace the 20-year-old Pine Tree Development Zone Program. That program no longer meets the needs of Maine businesses and provided no way for lawmakers to judge its effectiveness, House Majority Leader Rep. Maureen Terry (D-Gorham) said.

“Unfortunately, we were never really able to understand just how far off the rails the Pine Tree program went because there were no metrics to measure its successes and failures,” said Terry, a sponsor of the bill to create the Dirigo program.

The new program requires “clear, annual public reporting requirements” that will give lawmakers a chance to evaluate it, she said.

It targets industries such as agriculture, forestry, fishing, manufacturing, aquaculture, biotech, engineering, computer design and data processing.

Businesses in 13 Maine counties would be eligible for a 15% tax credit on capital investments, while those in Cumberland, York and Sagadahoc would get a 7.5% credit.

When it comes to worker training, businesses could get up to $2,000 per year per employee.

It’s estimated to cost $50 million a year which will lead to a $750 million return on investment, Terry said. That return excludes money that could be generated by new families moving to Maine.

The bill, which will be considered by the committee at a work session next week, is sponsored by Democrats and Republicans.

But two left-leaning groups — the Maine Center for Economic Policy and the Maine People’s Alliance — testified in opposition on Friday.  Both said the money spent on Dirigo would be better used if it were spent on childcare, housing or a new paid family medical leave program.

“Sweeping business tax giveaways are not the right approach for growing Maine’s economy,” said Maura Pillsbury, an analyst with the economic policy center. “We shouldn’t be giving big corporations an even greater advantage over the hardworking small Maine business owners.”

Maine Department of Economic and Community Development Commissioner Heather Johnson said if enacted, the Dirigo program would put Maine in the “lower middle tier” of states when it comes to the economic incentives offered to businesses.

“We think this keeps us at the table,” she said. “Maine has a lot to offer.”

Maine Community College System President David Daigler said the state must invest in workers who need additional training.

From just before the COVID-19 pandemic to now, Maine has seen a 15.6% increase in middle skill jobs and an 18% decrease in low skill jobs, he said.

“The thing is, those people whose low skilled jobs have gone away don’t transition into those middle skill jobs,” he said. “We need to provide as many resources as we can to help move those people from those jobs that have been vacated into new growth opportunities.”