Broad bill gives tax breaks on farms, fuels

Wednesday, March 12, 2008 | 8:34 p.m. CDT; updated 11:28 p.m. CDT, Monday, July 21, 2008

JEFFERSON CITY — The Senate gave first-round approval Wednesday to a bill that creates millions of dollars in tax breaks and subsidies.

The wide-sweeping bill combined several proposals for agriculture tax credits, subsidies and exemptions that have failed in recent years.

It sprinkles state aid to farmers, animal feeding operations, gas stations, motorists who buy biofuels, ethanol producers, dairies, livestock farmers, certain vehicle buyers and an agriculture education program.

But the tax breaks could be short-lived. Sen. Victor Callahan, D-Independence, tacked on an amendment repealing all the state’s tax credits Aug. 28, 2011.

The bill needs another vote before moving to the House, where it could be pared back.

Senators also amended the bill to make those who are getting tax credits and how much they receive public information. Elected officials and their immediate family members would need to report their tax incentives in financial disclosure statements filed with the Missouri Ethics Commission.

Sen. Brad Lager said a legislative committee studying tax credits had trouble getting the Missouri Department of Agriculture to release information about lawmakers’ tax incentives.

Agriculture Department records show that several Senate and House members have accepted thousands of dollars worth of tax breaks for investing in ethanol and biodiesel plants and other agricultural cooperatives.

Lager, R-Maryville, said the disclosures are important because they increase transparency.

The bill also resurrects a provision from a 2007 bill that tried to trump county regulations over animal feeding operations with state rules. That measure, which never passed, called for $10 million worth of tax breaks over five years to help animal farms reduce odor.

This year, senators cut it down to $1.5 million for five years, spending no more than $300,000 per year.

Both Republicans and Democrats complained the entire bill was too expensive and that agriculture is already heavily subsidized.

Sen. Matt Bartle said that for favored industries and businesses, lawmakers have been willing to “take the sword and tap them on the shoulder and give them special tax treatment.”

He said this year’s economic knighting comes at the expense of prudent budgeting.

“This is bad, bad, bad public policy,” said Bartle, R-Lee’s Summit. “Please don’t do it.”

Before senators started adding new tax breaks, Senate Appropriations Chairman Gary Nodler, R-Joplin, estimated it would cost $20 million when fully implemented.

But that wouldn’t come out of the state coffers all at once, because many of the tax breaks have annual caps and would phase out after several years.

Sponsoring Sen. Dan Clemens, R-Marshfield, said that supporting farmers helps keep food prices down.

Sen. Chuck Purgason said some of the newly proposed tax breaks are good ideas, but others just cost money.

Purgason, R-Caulfield, criticized politicians who call themselves conservatives but then steer government policy to help select interest or commodity groups, which forces more legislation to help other groups.

“A true conservative is someone who stands up and says, ‘No, not going to do it. I’m done,’ ” he said.

Besides tax breaks, the bill would add new requirements for local governments and volunteer fire departments seeking reimbursement for cleaning hazardous material spills. Currently, local governments can bill the owner of a spilled material for “reasonable” cleanup costs.

The legislation would require the local governments prove the costs are “necessary.” They would also need to justify why the costs aren’t part of the department’s normal services.

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