NEW BEDFORD -- The city of New Bedford awarded Francesco Insolia a five-year tax break in 2004, when he started expanding Michael Bianco Inc., his clothing and leather manufacturing business. By the time federal agents raided the factory this week and detained 361 workers on illegal immigration charges, he had already reaped more than $50,000 in tax savings.
The finding spurred New Bedford officials Tuesday to launch an audit of every business awarded a tax break over the last 10 years to make sure they are in compliance with hiring laws.
According to documents obtained from the city's Economic Development Council, the tax break given to Michael Bianco Inc., which would have totaled more than $80,000 by 2010, carried a requirement that approximately half of the new jobs be given to city residents.
"We're going to move to get every cent of that money back," said Mark Morrissey, the Economic Development Council's executive director, standing yesterday in a city office building with Mayor Scott W. Lang.
Morrissey said the audit would involve about 80 companies. The city plans to hire a compliance officer in the coming month. Officials across the city decried the situation at Michael Bianco.
"I guess we should have as many agencies as possible to make sure that businesses within our district are following the law," said Debora Coelho, a city councilor at large. "If were giving them tax breaks, we should go check up on our money."
Lang said he is dismayed that Insolia, out on bail after Tuesday's raid, continues to run the business.
"I'm seeking to have the company put in the hands of a trustee," Lang said. "There are 500 jobs at stake here for the city, and I don't want them to suddenly go away because of what one greedy owner did.
"If the allegations against him, that he knowingly hired undocumented workers and treated them like something out of a Charles Dickens novel, are proved true, then we'd like to see the business survive in other ends," Lang said.
In 2002, Insolia approached the city looking for funds for machinery and infrastructure at his factory.
But Morrissey said, "He didn't present a sufficient presentation to support that he could reach his business plan," raising questions about how he would be able to hire the number of workers specified in his business plan.
But by 2004, with a $138 million federal contract in hand, the company had already surpassed that 85-job requirement specified by the tax break contract, creating 98 jobs. In 2005, 93 more were created, and of the 291 total new jobs, 270 were filled by New Bedford residents, Insolia reported to the city.