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Consensus evaporates on incentives

Consensus evaporates on incentives

September 27th, 2011 in News

Missouri's special legislative session on business incentives appears to be fading to failure - in part because of a rush to take credit for its success.

Republican legislative leaders rushed to upstage Democratic Gov. Jay Nixon this summer by announcing they had struck an agreement on a sweeping package to curtail many of Missouri's existing tax credits and create new incentives for businesses. In hindsight, it's clear there was no agreement - at least not among most lawmakers.

Now in its fourth week, the special session has essentially been suspended. Lawmakers have left the Capitol. There are no more votes scheduled on the economic development legislation. There weren't even negotiations over the weekend between House and Senate leaders who, despite their summer

exuberance, are now exasperated with each other.

The "crisp, effective session" that Nixon hoped could be wrapped up within a couple of weeks? Well, it's turned stale.

"I think the prevailing question from a lot of us is: Why are we even here in the first place? Because there was not a consensus on rank-and-file caucus members on this issue," said Republican Sen. Chuck Purgason of Caulfield.

Purgason actually gave the first clue that the special session might not go as smoothly as forecast.

After the House and Senate failed to agree on a business incentive bill during the regular session that ended in May, Purgason was part of a small group of Republican representatives and senators who kept negotiating for a compromise plan that could be considered during a potential special session. But he was caught off guard when Senate President Pro Tem Rob Mayer and House Speaker Steven Tilley flew around the state July 20 to announce what they described as a "historic agreement" on a "comprehensive jobs bill."

Tilley, R-Perryville, declared it a "plan with broad support." Mayer, R-Dexter, said it "should have significant support."

Yet Purgason, on that same day, stressed that the "consensus" was really just a "concept" and the specifics had not been drafted as legislation.

"You really don't have a deal until you have things written down and both sides have signed off on them," Purgason said on July 20.

Eight days passed before a draft bill was distributed to lawmakers. Not long after that, Republican Sen. Jason Crowell, of Cape Girardeau, began publicly picking apart the plan. He declared: "This back room deal must not be allowed to pass."

Other senators soon added their concerns to Crowell's threats of a filibuster. The bill that ultimately passed the Senate on Sept. 14 was significantly different from the summertime agreement. Most notably, it scaled back the proposed tax breaks intended to encourage international cargo flights at the St. Louis airport and added a Nixon-backed plan called Compete Missouri that would consolidate several of the state's existing business incentives while giving the Department of Economic Development new discretion to award upfront cash to businesses.

Republican House leaders refused to consider the Senate plan. Instead, Tilley outlined an alternative that he said included about 85 percent of what the Senate wanted. But the House plan dropped the summertime agreement to end two of the state's most costly tax credit programs, which finance the construction of low-income housing and renovation of historic buildings. After Republican senators said that wouldn't fly with them, House leaders decided not to bring the bill up for a vote.

Thus the current stalemate.

Tilley describes the Senate as "dysfunctional" and "broken" and blames Republican Senate leaders for failing to deliver the plan they agreed to this summer.

"I would have never agreed to ask the governor to call us into special session if we thought the Senate couldn't live up to their end of the deal," he said.

Mayer criticized the House for not voting on a revised bill and blamed interest groups for blowing a hole in the summertime consensus.

"Since July, we've had some powerful political entities that have worked very hard to kill the deal," he said.

He named four specific entities: the Show-Me Institute, a St. Louis-based free market institute that questioned the air cargo incentives; tea party members who protested the newly proposed tax credits; low-income housing developers who sought to preserve their tax credit program; and some anti-abortion organizations who feared a separate bill creating an incentive fund for science-based companies lacked sufficient safeguards to prevent money from funding human embryonic stem cell research.

Lawmakers have until Nov. 5 - when the special session automatically expires - to rediscover the consensus they declared this summer.

Nixon said he believes the differences still can bridged. But he's no longer predicting that will occur crisply.

"The centerpiece of this has always been for me - as I've said time and time again - putting together this comprehensive jobs package and paying for it. They remain short of the mark of getting that done within this timeframe," Nixon said. But "I remain committed to getting that done - now or whenever."