JEFFERSON CITY — Senators who would be responsible for reviewing tax credit applications under a proposed bill are mixed on whether they should have the authority to do so.
"I think it's still a very tangled situation," said Sen. Joan Bray, D-St. Louis County, who sits on the Senate Appropriations Committee that would review the tax credits under the bill proposed by Sen. Jason Crowell, R-Cape Girardeau.
The more than 50 tax credits cost Missouri nearly $600 million in revenue not collected last year, a figure which has grown exponentially in recent years, Bray said.
"I think it's only proper that they come out before the committee and argue the merits of the tax credits versus giving more money to education or some other program that could be funded with the money that goes to tax credits," said Senate Appropriations Committee Chairman Sen. Rob Mayer, R-Dexter.
But State Economic Development Director David Kerr told the committee on Monday that subjecting tax credits to the appropriations process could scare off businesses.
"What businesses need is certainty," Kerr said. "If it's not certain, they will go to a state where they know what they're getting."
Mayer said he acknowledges concerns about certainty, but mechanisms could be put in place to make it work.
Though it would be a bit more work for the committee, he said it would be appropriate.
"To me it makes a lot of sense," he said.
Vice Chairman Sen. Kurt Schaefer, R-Columbia, who also serves on the committee that heard Crowell's bill last week, said he isn't sure.
"While we certainly need to make sure that we're getting the most efficiency out of these dollars, we also need to make sure that we don't take what little economic development we have and kill it by an ill-conceived decision on tax credits," he said.
Schaefer said imposing more caps on tax credits is another tool to use in ensuring efficiency, which would yield more certainty for businesses applying for tax credits.
Bray said she'd like more certainty about the state's obligations.
Most tax credits can be redeemed for several years after their initial date of issue, which makes budget planning difficult, she said.
But opening tax credits to review could make the process more political, she said, because many of them were pet projects of legislators and governors.
"In a body of 197 people," she said, "you're going to have 197 different ideas about what's appropriate."