All sides weigh in as legislators convene to consider Nixon plan to woo Boeing
This article first appeared in the St. Louis Beacon, Dec. 2, 2013 - As the Missouri General Assembly prepares to convene for a special session to woo Boeing, several groups on both sides of the job-creation debate are weighing in with their ideas.
The Missouri Budget Project, a progressive advocacy group that focuses on fiscal issues, is calling on legislators to avoid targeting tax breaks for the poor and elderly as a way to help come up with the $150 million in tax credits that Gov. Jay Nixon is proposing for Boeing.
The group also raised concerns that some legislators may seek to link any tax breaks for Boeing to broader tax cuts for other corporations – notably, something similar to the tax cut package that Nixon vetoed earlier this year, on the grounds that it would force cuts in public education and other necessary state programs.
House Speaker Tim Jones, R-Eureka, hinted at the possibility of broader tax cuts in a statement issued over the weekend.
Meanwhile, the Associated Industries of Missouri (AIM) says its legislative allies will introduce a measure “that addresses the unique training needed for new workers in advanced manufacturing, information technology, and other highly technical fields.”
The special session, which begins at 4 p.m. Monday, was called by Nixon so that legislators and his administration could quickly craft an incentive package that might persuade Boeing – which already employs 15,000 in Missouri for military aircraft – to move production of its planned new commercial plane, the 777x.
Boeing is soliciting proposals from a number of states in the wake of its battle with the Machinists union in the aircraft manufacturer’s home state of Washington.
Associated Industries Ray McCarty said in a statement that his group “applauds the governor's call for a special session to allow Missouri to compete for any part of the planned production of the 777x plane by Boeing.”
"We believe Missouri should do whatever is necessary to compete for as much of the work on the Boeing project as we can possibly secure," said McCarty. "But this is an opportunity for Missouri to also address needs of our existing Missouri employers to train workers in highly technical and often confidential and proprietary processes.
“Allowing job training money in these situations to be used to pay trainers that are on staff and possess the unique skills needed to operate machinery that can only be learned 'on the job' is crucial for this project as well as other rapidly expanding employment programs in other high tech fields," McCarty continued.
Associated Industries would like to see such provisions as part of any Boeing incentive package, McCarty said, calling it “an opportunity to kill two birds with one stone and help every employer in the state that must train large numbers of new employees on highly technical and proprietary machines…”
'Circuit breaker' tax credit may be targeted
The Missouri Budget Project is raising concerns that legislators might be tempted to seek tax breaks for all corporations or go after such tax credits as the “circuit breaker’’ credit that provides a tax breaks for low-income elderly and the disabled who own or rent their homes.
“As the Missouri legislature convenes to craft an incentive package for Boeing, it is critical to Missourians’ economic well-being and quality of life that legislators protect revenue for state services and avoid funding incentives on the backs of vulnerable Missourians,” the Project said in a statement.
“Some lawmakers have suggested funding incentives to Boeing through decreases in existing tax credits,” the group said. “While many existing credits can and should be improved, tax credits for large corporations should not be funded by using the circuit breaker tax credit as an offset. Economic development should not come at the expense of low-income seniors and those living with disabilities that own or rent their homes.”
As for any broader tax cut for corporations or individuals, the group resurrected the argument that critics used this summer to bolster Nixon’s veto of the tax-cut bill, SB253. “The subsequent cuts to education, infrastructure, workforce training, and other state services would impair our state’s ability to create, and Missourians’ ability to retain, quality jobs in the future,” the Budget Project said.
House speaker recalls summer's tax-cut fight
House Speaker Tim Jones, R-Eureka, had been a strong supporter of SB253, and made note of that fact in his weekend statement. He emphasized that House Republicans remain committed to “tax policies and incentives that will lead to solid job and economic growth much like the tax reduction bill we passed for all Missouri families, farmers and businesses that was vetoed by the governor just a few months ago. We trust that the governor will be much more willing to work with us rather than against us as we pursue this latest opportunity.”
As for the specifics of any Boeing proposal, Jones said, “We are in the very early stages of substantive discussion and the actual details of any kind of proposed incentive package are pure speculation. Until the governor is able to provide us the specifics that are necessary to make a competitive bid, we will simply remain cautiously optimistic about this potential opportunity.”
But Jones also indicated that the House planned on being a partner in crafting a package. “Even without knowing all of the details, we are excited to have the chance to partner with an outstanding employer like Boeing, which already employs over 15,000 people here in Missouri,” he said. “It is safe to say we are willing to be aggressive in working with Boeing to bring even more of these high-paying jobs to our state. And in being good stewards of taxpayer funds, any potential incentives we consider will need to be measured against our duty of fiscal responsibility so that we can make absolutely certain that Missouri taxpayers are protected and given the opportunity for the best outcome possible."