February 12, 2012

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Governor-backed auto industry incentives introduced

January 26, 2012 By
The automotive industry incentive component of the Governor’s job creation strategy has found its backers in the House and Senate, and they come from both sides of the political aisle.
 
In his State of the State Address and stops around the state, Governor Jay Nixon has promoted his Missouri Works plan. It would expand on the provisions of the Missouri Manufacturing Jobs act of 2010, which helped promote expansion at Ford’s Claycomo Plant in Kansas City and General Motors’ plant in Wentzville. Legislation introduced this week basically targets those incentives at manufactures in the automotive industry.
 

Representative Chuck Gatschenberger (R-Lake St. Louis) is sponsoring HB 1455.

The House version, HB 1455, will be carried by Representative Chuck Gatschenberger (R-Lake St. Louis). He says, “Those manufacturers of vehicles … they need brakes, they need windshields, they need trim, they need engines … and not all of those are built right there on that spot.”

Parts makers qualify under the proposal if the products they make are used by an automaker. Companies with at least half of their sales coming from parts used to modify vehicles can also qualify for incentives.

Gatschenberger says it offers two options to those companies. “One is if you employee five employees, you’re gonna get the same benefits with withholding the taxes that you pay from the state for the benefit of the company. The other aspect of it … there’s a lot of companies in this state that are not going to be able to employ five people but they can employ two people. If they do two people and $100,000 of investment in their business, they can fall under the same guidelines.”

Gatschenberger says it also includes some clawback provisions.  ”Let’s say they have those two people but they lay two other people off. Then they lose the benefit. It’s not the specific people that they hire, it’s the total number of people.”

See the Governor’s Office’s release on the introduction of the legislation.

The package increases the standard incentive period to five years, from the three found in the 2010 language. Companies would get a tax break equaling 5 percent of their new payroll if wages are at the average for the county, 5.5 percent for wages that are 120 percent of that average and 6 percent for wages at least 140 percent of the county average.

Senator Kevin Engler (R-Farmington) is the sponsor of SB 691.

Gatschenberger notes the package opens up incentives to all auto manufacturers, not just Ford and General Motors, “So if Nissan thinks, ‘Hmm, we might want to put a plant somewhere but where are we going to put a plant,’ it’s making the carrot bigger and jucier.”

The Governor’s Office says the package boasts a lengthy list of bipartisan supporters. Also in the House are Speaker Steven Tilley (R-Perryville), Majority Floor Leader Tim Jones (R-Eureka), Jerry Nolte (R-Gladstone), Minority Leader Mike Talboy (D-Kansas City), Assistant Minority Floor Leader Tishaura Jones (D-St. Louis), Minority Whip Mike Colona (D-St. Louis), Representative Stephen Webber (D-Columbia) and Representative Bert Atkins (D-Florrisant). Senator Kevin Engler (R-Farmington) is sponsoring the Senate version, SB 691 with Minority Floor Leader Senator Victor Callahan (D-Independence) a co-sponsor.

Filed Under: Business, Economy, Legislature, News, Politics & Government Tagged With: , , , , , , , , , , , , , , , , , ,

Budget director: challenging year for state (AUDIO)

January 18, 2012 By

An economy that is only slowly recovering and the end of federal stimulus money used to prop up state programs means some of those programs will have to take cuts..again.

Governor Nixon’s proposed state budget uses cuts in some programs, services, employees, and subsidies to fill a half-billion dollar hole.  State budget director Linda Luebbering says the biggest funding cut comes in higher education–about $106 million.  “Quite frankly….we don’t have the money,” she says.

Senate appropriations chairman Kurt Schaefer of Columbia says a 12.5%  cut to higher education is “unacceptable.”  He accuses Nixon of balancing the budget on the backs of education for the last three years.

Nixon hopes the legislature will enact a tax amnesty program that might convince people to pay 51 million dollars in back taxes without penalty.  The issue has failed in the past.     

AUDIO: Listen to the budget briefing approx 39:00 mp3

Filed Under: Economy, Education, Featured, Legislature, News, Politics & Government

House, Senate leadership reacts to Governor’s speech (AUDIO)

January 18, 2012 By

Legislative leaders from both sides of the aisle react to the Governor’s State of the State address.

Governor Jay Nixon is greeted by legislators as he leaves the Missouri House Chamber after delivering the State of the State address at the State Capitol in Jefferson City. UPI / Bill Greenblatt

All agree on one thing … much work lies ahead in balancing the state budget. House majority floor leader Tim Jones of Eureka says he thinks the governor is a fine speech giver, but says he was looking for more specifics on where to go with the budget. He thought the speech was largely a repeat from last year, and was more of a campaign speech in an election year than an address to legislators.

“I think the Governor is a fine speech giver but … again, I think the two things I was looking for was a specific plan on what we were going to do this session and also, I was looking for specific proposals from the Governor as to how we’re going to balance the budget,” Jones says.

Minority Floor Leader Mike Talboy of Kansas City says in an election year, every speech is a campaign speech, and that the Governor laid out clear priorities to focus on — budget, job creation, economic development and education — and that specifics will come with budget talks in the coming days.

Both parties agree that the governor’s proposed cuts to higher education are concerning, but that bolstering K through 12 funding is an important priority.

Jones says he was looking for a specific plan on what the legislature is going to do this session and specific proposals from Nixon on how they’ll balance a budget that is $500 million to $700 million short.

AUDIO: Republican Response (pre-recorded / aired after State of State) — 8:02 min.

AUDIO: House Majority Floor Leader Tim Jones interview — 7:39 min.

AUDIO: House Minority Floor Leader Mike Talboy interview — 4:43 min.

AUDIO: Senate leadership response, Mayer, Schaefer — 12:02 min.

AUDIO: Jessica Machetta reports – 1:13 min.

Filed Under: 2012 Campaign, Economy, Education, Elections, Legislature, News, Politics & Government

Nixon takes positive tone in message to legislature (AUDIO)

January 17, 2012 By

The Governor took a mostly rallying approach to his State of the State Address.

Jay Nixon began by highlighting Missouri’s response to the disasters in the state last year. He keyed on the inspirational words of one Joplin tornado survivor, “always take that extra step.”

Missouri Governor Jay Nixon presents his State of the State Address to a joint session of the state legislature. Picture courtesy, Tim Bommel, Missouri House of Representatives.

Nixon touted that the state has not raised taxes and has reduced the size of government. With his proposed budget, he says, he reduces the state’s payroll by 4,100 positions. A total of 816 reductions are included in the new proposal. He notes the state’s workforce is the smallest its been in 15 years.

The address did not include the specifics of his proposed $106 million cut from the state’s 4-year and community colleges, but he did allude to it.

“To balance our budget in a way that protects our scholarships and academic programs I’m calling on our colleges and universities to continue to look for more ways to cut overhead and administrative costs and run smarter, more efficient operations.”

He said colleges and universities will have to change their business models. An example he offered is the “Innovation Campus” program at the University of Central Missouri.

“Students will enroll in college courses while still in high school and then participate in high-impact apprenticeships throughout the college curriculum.” he says. “Corporate partners will underwrite tuition scholarships and faculty and employees will partner to guide each student.”

Nixon encouraged the state’s institutions to develop similar programs.

The Governor stressed budget priorities, including education.

“For the past three years, even in challenging budget times, we’ve maintained level funding for our K-12 classrooms,” Nixon says. “This year we’re gonna take the next step. The budget I present tonight provides record funding for our K-12 classrooms because it’s the right thing to do.”

Some of Nixon’s calls to the legislature were familiar. In his only chide of the night he said, “For the past three years I’ve called for comprehensive tax credit reform. Some of you in this room stood with me on that issue, others did not.”

Nixon says over the past four years more than $2 billion in state tax credits have been redeemed. He re-iterated the call to pass legislation to retool and reform tax credits. He also urges legislators to create bills on charter school accountability and to increase the number of professionals working with autistic children.

Another priority that carries over is that of campaign finance limits. Nixon told the joint session, “When one person with an axe to grind can make an unlimited contritbution to advance a narrow agenda, when lobbyists for powerful interests can tip the balance in an election, the very foundations of our democracy are at risk.

AUDIO: Listen to Governor Jay Nixon’s 2012 State of the State Address (54 mins.)

AUDIO: Mike Lear reports (1 min.)

Filed Under: Business, Economy, Education, Fires/Accidents/Disasters, Health & Medicine, Legislature, News, Politics & Government Tagged With: , ,

State spending cap passes House Budget Committee

January 11, 2012 By

The House Budget Committee has advanced a proposed change to the Missouri Constitution to limit future state spending.

Former House Budget Committee Chairman Allen Icet (left) testifies in favor of HJR 43 alongside its Sponsor, Representative Eric Burlison (R-Springfield).

Representative Eric Burlison (R-Springfield) is sponsoring the measure, HJR 43. It would limit the amount of state general revenue that can be appropriated to the rate of inflation plus population growth.

Under the measure, 1.5 percent of growth over the previous year could be used for appropriations. Any amount between 1.5 and 2.5 percent would be used to pay off state debt. Any amount beyond that would be divided between two emergency funds that would replace the current Budget Reserve Fund, more commonly called the Rainy Day Fund. When those funds are full if there is more growth, it could go toward a state income tax refund.

The proposal is part of the House Republicans’ legislative plan, the “Blueprint for Missouri.”

The Committee voted 20-9 to pass the resolution, with Representative Chris Kelly (D-Columbia) the only Democrat to favor it.

Kelly offered an amendment that made the 2008 budget year the baseline for the resolution, when general revenue was roughly $8 billion dollars. That means the amendment would not kick in until the fund reached that level, which lawmakers agreed is unlikely in the forseeable future.

Burlison says the change would stabilize the budget process and prevent the creation of programs in years of excess only to have them cut when the economy takes a down turn. He says now is the time to enact the resolution, when the economy is down. “We’re experiencing the difficult end of this. We’re looking back and saying if only legislators prior to us had had something like this in place then we wouldn’t have been having to make some of these very difficult cuts that we’re making today. We would have had money in reserves…in savings that we could go to.”

An almost partisan split

Among those opposing the bill, Representative Genise Montecillo (D-St. Louis) says she worries that even in the high mark year of 2008 some funding levels were not sufficient. “Even if I could get all the money in the world for education I have some concerns for social services as well. So, it seems to me that we’re kind of locking some groups into a continued future of being under funded when our needs in our state are becoming greater with unemployment still at really high levels.”

Other Democrats criticized that Republican leadership is trying to limit spending while offering no plans to generate more revenue such as increasing the cigarette tax or collecting internet taxes. 

Representative Kelly countered, “As you know, I am a big supporter of raising more revenue around here, but raising revenue is a different question than managing the revenue that we have.”

Representative Burlison noted that the resolution exempts new or increased tax revenues or fees that are voter approved from appropriations growth limit calculations for the year they are passed.

The measure moves on to the Rules Committee, which meets tomorrow at 9:30 a.m. As a constitutional amendment, it would eventually have to go before Missouri voters.

Filed Under: Economy, Legislature, News, Politics & Government Tagged With: , , , , , ,
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