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Missouri GOP scrutinizes tax credits in job-creation plan

Tuesday, February 17, 2009 | 8:34 p.m. CST; updated 10:05 a.m. CST, Wednesday, February 18, 2009

 JEFFERSON CITY – A job-creation plan endorsed by Gov. Jay Nixon ran into opposition from a group of Republican state senators during session Tuesday.

Although the bill is being sponsored by a fellow Republican, other GOP senators questioned whether tax credits specified in it would achieve the intended results of job creation and an expanded Missouri economy.

"We have become drunk on tax credits," said Sen. Brad Lager, R-Maryville.

"We're switching over to the philosophy of Leona Helmsley when it comes to our tax credit policy," said Sen. Luann Ridgeway, R-Smithville.  "Taxes are for the little people, is what Leona said. Missouri doesn't need to be fashioning our tax credit policy on the basis of a known felon and tax cheat."

A section of the bill would double the cap on the Quality Jobs Act, which issues tax credits for business expansion, from $60 million to $120 million.

The bill passed though the House amid complaints from some Democrats that the bill was not a bipartisan effort and did not include amendments that would have increased accountability for government assistance.

Sen. David Pearce, R-Warrensburg, said the bill, which he sponsored, could create 30,000 jobs.

"We are not a job generator, but what we do and what our task is, is to create a climate so that our state's people can create jobs," he said.

Sen. Jason Crowell, R-Cape Girardeau, challenged those figures and said he would bet his house that the bill would not create 30,000 jobs.

"You say that it might create 30,000 jobs. It might do this," he said. "I know of one thing we're actually certain it would do, and that is that you're spending over $100 million of hard-earned taxpayer money, and I want to know what we're going to get from it. What is the return on the investment?"

Crowell said the bill favored special interests, citing three tax credits within the bill that would benefit mines. He said the bill needed to include small businesses and force tax credits to go through the appropriations process.

"We are picking winners and losers everyday in Jefferson City," he said. "Why should a guy that owns a lot of old mines be sales tax exempt as opposed to a guy in Cape Girardeau who owns a bicycle shop?"

Pearce challenged Crowell's arguments. 

"What's the option, doing nothing?" Pearce asked. "Our unemployment level is 7.6 percent.  We're losing jobs.  Our state needs a shot in the arm."

But Sen. Matt Bartle, R-Jackson County, said increasing tax credits has become a national game in which states compete against one other.

"No sooner do we get it (the job creation bill) passed and Kansas rushes off and they make their program richer, and Arkansas goes and makes theirs richer," he said. "And guess what? Next year, we're back where we started."

Bartle said the state should give tax breaks to all businesses so they can spend moneyas they see fit, rather than giving tax credits to a select few.

"We would be sending a signal to all businesses: we're staying out of your business," he said.

Ridgeway said the majority of her constituents would not benefit from what she called designer tax credits included in the bill that serve special interest groups and not Missourians.

"They belong to the people who can afford the lobbyists, they belong to the people who can afford accountants, they belong to the people who afford lawyers," she said.

 


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