Audit of the Massachusetts Office of Business Development (MOBD)

This is a state performance audit of the Massachusetts Office of Business Development covering July 1, 2015 through June 30, 2017.

“This report details the audit objectives, scope, methodology, finding, and recommendation for the audit period, July 1, 2015 through June 30, 2017.”

Auditors checked whether the office properly ran two programs: the Regional Economic Development Organization Grant Program and the Buy Massachusetts Program.

“This performance audit was undertaken to determine whether MOBD effectively administered (1) the Regional Economic Development Organization Grant Program and (2) the Buy Massachusetts Program.”

The missing program matters because it was meant to keep more business spending inside Massachusetts instead of going to companies outside the state.

“As a result, local companies might be purchasing goods and services from companies outside the Commonwealth to the detriment of Massachusetts businesses.”

For residents, the issue is whether state economic-development efforts are helping Massachusetts businesses grow, keep jobs, and attract private investment as intended.

“MOBD’s mission, according to its 2017 annual report, is as follows:”

The auditor concluded that MOBD properly ran the REDO Grant Program, but did not properly administer the Buy Massachusetts Program because it had never been implemented.

“Has MOBD properly administered the Buy Massachusetts Program according to Section 10A of Chapter 23A of the General Laws?”

The auditor recommended that MOBD look for money to operate the program, including annual state funding and other possible funding sources.

“In addition to requesting an annual appropriation, MOBD should also seek other sources of funding to operate this program.”

The key significance is that state law required the Buy Massachusetts Program, but the agency had not started it or sought funding for it during the audit period.

“Given that the establishment of this program is statutorily required, it is the Office of the State Auditor’s opinion that MOBD should seek funding from sources including the general court; the federal government, which periodically makes grant funding available; and public-private partnerships with the Commonwealth’s local and regional chambers of commerce and other business-oriented organizations.”

REDOs are regional nonprofit groups focused on economic development across at least 10 neighboring cities or towns.

“REDOs are tax-exempt organizations that, according to MOBD’s request for proposals (dated July 30, 2018) for the REDO Grant Program, “demonstrate a primary focus on regional economic development . . . and service 10 or more contiguous cities/towns.””