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Lawmakers leave without passing tax credit bill

Lawmakers leave without passing tax credit bill

May 13th, 2011 in News

An overhaul of Missouri's economic incentives fizzled on the final day of the legislative session, but lawmakers staved off a huge budget hole and renewed a program that helps cover the medicine costs of a quarter million elderly and disabled residents.

The demise of the economic development bill came despite the frenzied efforts of lawmakers, business groups and Gov. Jay Nixon's administration to forge a compromise between those wanting to curtail Missouri's current tax credits and others wanting to add new incentives for a smattering of businesses. Despite a similar final-day effort, lawmakers also failed to pass legislation that could have eased the path toward development of a second nuclear power plant in Missouri by allowing consumers to be billed for some of the costs.

With barely an hour remaining before their 6 p.m. adjournment, lawmakers gave final approval to a bill lowering the minimum age to obtain a concealed guns permit in Missouri to 21 instead of the current age of 23 - a threshold the National Rifle Association said had been the highest nationally among states granting such permits.

Legislators approved a four-year renewal of several health care taxes that were due to expire Sept. 30 - averting the loss of $3 billion in matching federal and state funds that are used to finance Missouri's Medicaid health care program for the poor. They also renewed a state program - called "a vital lifeline" by Nixon - that helps pay the prescription drug costs of 226,000 low-income seniors and disabled residents covered by the federal Medicare program.

Yet lawmakers failed to authorize a tax amnesty program that both they and Nixon had counted on to help balance the state budget. The plan would have waived interest and penalties for some delinquent taxpayers to entice them to pay up - generating revenues Missouri would not otherwise have collected. Nixon said the bill's failure accounted for about one-third of what he said was a now-$90 million shortfall in the 2012 budget passed by lawmakers. He pledged to make cuts.

The legislative session came to a close at 6 p.m. Friday, the mandatory quitting time set by the state Constitution. House Republicans followed tradition by tossing their suddenly useless bills and amendments up in the air. House Democrats did not.

The negotiations on the economic development legislation commanded much of the attention on the final day - even as key lawmakers gradually downgraded its chances from unlikely to dismal to dead.

The end result is there will no tax breaks to transform the St. Louis airport into an international cargo hub, no incentives targeted to science and technology companies and no state aid to lure big-time amateur sporting events to Missouri.

"It's a shame," said Republican Sen. Eric Schmitt, of Kirkwood, leaning against the Senate wall after his negotiations on the legislation ultimately proved fruitless.

The bill's failure also means that low-income renters can continue to claim a state income tax credit and developers will face no reduction in state incentives for the construction of low-income housing or the renovation of historic buildings.

Senate President Pro Tem Rob Mayer said he already has had discussions with Nixon about calling a special legislative session on the package of tax incentives - much as Nixon did last year to secure passage of tax breaks targeted at a Ford Motor Co. plant near Kansas City.

"He never made me a promise that we would have a special session," said Mayer, R-Dexter. But "he certainly didn't close the door on the chance for a special session for the bill on economic development."

Before calling a special session, Nixon said there would first need to be consensus among legislators on a specific plan that could help spur the economy. But he said this year's legislation - including the incentives for the trade hub at the St. Louis airport - are not as urgent as the potential loss of thousands of jobs at the Ford plant was last year.

Although he had called for passage of legislation intended to encourage the development of a second nuclear plant, Nixon said Friday that he doesn't view it "as something that is pressing enough at this point to consider for a special" session.

The regular session ended with senators making a last-moment effort to bring up a compromise on the nuclear-permit bill reached among utilities, industrial energy users and others. But the legislation was set aside after several senators expressed a reluctance to read and vote on something they had received with barely 30 minutes left in the session. The House, meanwhile, used a portion of its final hour to send the Senate its version of the economic development legislation - a symbolic move that wasn't even acknowledged in the Senate.

At one point Friday, House Majority Leader Tim Jones posted a Twitter message complaining that the House "continues to pass good government bills" but the Senate "legislative terrorists continue to kill them."

The Senate took an unusually large number of breaks on its final day as it waited for developments on a few priority bills. Part of the reason for the slow final day was that several prominent bills passed in earlier in the session. An extension of federally funded long-term unemployment benefits for Missouri residents - paired with a reduction in state-funded benefits - was signed into law last month by Nixon after four senators upset about federal spending relented from a filibuster.

Nixon also has already signed laws rewriting a voter-approved law regulating dog breeders and restricting nuisance lawsuits against agricultural producers such as large hog farms. In both cases, Nixon's administration negotiated a compromise only after lawmakers had already sent him a bill, which necessitated the passage of a second bill.

With the aid of some Democrats, the Republican-led Legislature this year overrode Nixon's veto to enact new congressional district boundaries - paring back the districts from nine to eight and accounting for population shifts within the state revealed by the 2010 census.