Job-creation plan in jeopardy?
Monday, September 19, 2011
Unless consensus can be found in the next couple of days, Missouri House members may simply spike a job-creation bill approved by the Senate and end a special legislative session without passing any new incentives for businesses to locate and expand in Missouri, a key lawmaker said Monday night.
Rep. John Diehl, a lead sponsor and negotiator on the economic development efforts, said the Senate legislation passed last week “is dead on arrival” in the House because it deviates too greatly from the deal struck between Republican House and Senate leaders this summer.
Based on that agreement, Democratic Gov. Jay Nixon called lawmakers to convene in an extraordinary session that started earlier this month. But the original agreement ran into opposition in the Senate, where it was significantly reshaped.
Diehl said the main sticking point now is “Compete Missouri” — a proposal backed by both Nixon and the Senate that would consolidate several of Missouri’s main business incentives into a single program for which it would be easier for businesses to qualify and which would empower the Department of Economic Development with new authority to offer upfront cash to some businesses. Compete Missouri was not part of the pre-session agreement among Republican leaders, largely because of House concerns about the new discretion it would grant to executive branch officials.
“We have to either get together and get this thing figured out in the next 48 hours, or I think we just need to go home,” said Diehl, R-Town and Country.
Diehl spoke to The Associated Press and a couple of other media outlets Monday night outside a House committee room in the
Missouri Capitol as Nixon’s director of economic development, David Kerr, was wrapping up his testimony inside the room in favor of the Compete Missouri proposal.
“Under Compete Missouri, we have virtually the same amount of discretion as we have today” under existing business incentive programs, Kerr said while trying to assuage lawmakers’ concerns.
The House Economic Development Committee was scheduled to meet Tuesday to consider voting on its own version of the legislation, which would more closely resemble the original agreement. The House Rules Committee then was scheduled to meet later in the day to advance the bill to the House floor for debate. But Diehl said he had canceled the Rules Committee meeting. He added that the Economic Development Committee might also opt not to vote on the legislation Tuesday.
Despite the uncertainty of the legislation, dozens of supporters and opponents testified about the bill during a lengthy public hearing that stretched from Monday afternoon into the night.
Some testimony focused on a plan to authorize up to $60 million of tax credits for companies that coordinate exports through Lambert-St. Louis International Airport. The Senate deleted an additional $300 million of earmarked tax breaks for warehouses and manufacturers that would handle those products. But senators said those businesses could still apply for incentives through other state programs, which Diehl said highlighted the new discretion that would be available to Nixon’s administration under the Compete Missouri proposal.
St. Louis Mayor Francis Slay said even without incentives, a cargo flight from China is scheduled to land Friday at the St. Louis airport.
But “one flight does not make a hub,” Slay said. “We want 20 or 30 flights a week,” which he said is possible only if Missouri offers incentives to build the facilities needed to handle the products.
Slay’s testimony was sandwiched around that of Tony Clayton, the president of Jefferson City-based Clayton Agri-Marketing Inc., and Eric Green, vice president and managing director of international sales at St. Louis-based Sigma-Aldrich.
Clayton said he ships pigs internationally about once every 11 days out of an airport in Chicago. If incentives help build up a cargo hub in St. Louis, it could be more convenient for his business because one of his largest suppliers of pigs is located in Illinois about 40 miles south of St. Louis. Green said Sigma-Aldrich, which produces chemical products used in scientific research, would like to consolidate its international shipping in St. Louis if the proposed incentives help it become cost-competitive to do so.
Later Monday night, Paul Hamby, of the Missouri Campaign for Liberty, urged House members to hold off on the so-called Aerotropolis tax credits.
“Every time you’re making a choice to fund Aerotropolis, then you’re your making a choice to not create jobs throughout the rest of the state” with revenues that could have gone for other purposes if not waived by tax credits, Hamby said.