Missouri tax credit reform faces opposition

Wednesday, April 21, 2010 | 7:40 p.m. CDT

JEFFERSON CITY — Just minutes after Missouri's governor urged lawmakers to impose controls over tax credits, the House Speaker vowed that no tax credit reform bill would reach his desk in this year's legislative session.

Speaker Ron Richard, R-Joplin, said making drastic changes in the last three weeks of the legislative session would send too many shock waves through the business community.

"I know more about economic development than all of you guys (the press) in here put together and probably the governor, and I'm telling you that I will do ... what's best for Missouri," he said. "We're going to have certainty (for businesses), and I'm going to make sure we have certainty."

Richard's vow came after a press conference during which the governor and more than 65 education leaders pushed for imposing additional controls on tax credits to businesses and other special interests.

Gov. Jay Nixon warned that tax credits have ballooned 86 percent over the last decade.

Nixon specifically targeted the Historic Tax Credit Program and low income housing credits. He said Missouri has given out double in historic tax credits than what Virginia has and double what California gives in low income housing credits.

"Every dollar we spend on tax credits is a dollar that isn't available for education," Nixon said.

University of Missouri System President Gary Forsee also spoke at the press conference, focusing on the discrepancy between growth in tax credits and the stable level of state education funding.

"Education is the linchpin to (the economic growth) formula pure and simple," Forsee said.

Republican House leadership criticized education leaders for waiting until the session is nearly over to bring up tax credits. It also criticized the governor's office and Senate for not focusing on jobs.

"The governor can use kids as silly props today to try to boost his sagging poll numbers, but let's not get together and focus on what we can do to get more jobs in this state," said House Speaker Pro Tem Bryan Pratt, R-Blue Springs, sarcastically.

But Jack Cardetti, the governor's spokesman, pointed out that there were no children at the press conference.

Nixon proposed three weeks ago that tax credits overall be limited to 70 percent of the total amount received last year and that the Department of Economic Development be given purview over the programs, a move criticized by House Republicans as a "power grab" by the executive branch.

In contrast, Sen. Jason Crowell, R-Cape Girardeau, has pushed for tax credits to be subjected to the appropriations process in the legislature.

Sen. Tom Dempsey, R-St. Charles County, has a bill that cuts tax credit programs across the board with a "share-the-pain concept."

Nixon said Dempsey's bill is the most likely to get out of the Senate.

But Dempsey, acknowledging deep divisions within the Senate on the issue, said the Senate had not reached a point that a bill could win passage in the upper legislative chamber.

The House leadership said it is going to take a thorough, slower look at tax credits but is going to continue its focus on job growth.

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