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Home arrow Issues/Politics arrow House bucks Nixon, offers tax lures for Ford -- and electronic data centers
House bucks Nixon, offers tax lures for Ford -- and electronic data centers Print E-mail
By Terry Ganey, Special to the Beacon   
Posted 7:55 pm Tue., 06.29.10
JEFFERSON CITY - The Missouri House answered Gov. Jay Nixon's special legislative call on Tuesday and then raised him, approving a job-creation bill that goes further than what the governor sought when he asked for help to keep a Ford plant in Kansas City.

The House voted 125-19 to send legislation to the Senate that includes millions of dollars in property tax abatements and sales tax exemptions to attract electronic data centers to the state. The bill also would let Ford keep withholding taxes amounting to as much as $15 million a year for 10 years, provided the automaker opens a new car production line at its Claycomo plant.

The maneuver amounts to a gamble for sponsor, Rep. Tim Flook, R-Liberty. He said it would be up to the Senate either to take or leave what the House had sent over. And he left it up to Nixon to decide whether to expand the agenda for the special session to provide the authority to consider the data center provision.

"It's somewhat academic what the governor would do because we don't know where the Senate is ultimately going to land," Flook said. "We know there is some opposition. We know there is some support. We hope they will take it up."

When Nixon called lawmakers back into special session, he asked them to approve subsidies for Ford and to enact savings in the state workers' pension plan. For the special session's agenda to be expanded for additional business incentives, Nixon would have to amend the message he signed calling lawmakers back after their May 14 adjournment. House Speaker Ron Richard sent Nixon a letter asking him to do just that.

"I suspect it would be in his best interest to create jobs," Richard said. "That's what we're here for; I suspect that's what he ought to be here for, too."

Committees of the Senate were scheduled to meet Wednesday to consider the two bills that won final House approval Tuesday. While the economic development bill was important to legislative leaders, Richard and others indicated they were less interested in what happens to the pension measure that the House passed 92-54. It would require state workers to contribute 4 percent of their salaries to help fund their pensions and to wait longer to get benefits.

Both Richard and Rep. Jim Viebrock, R-Republic, said they believed it wasn't necessary to consider the state retirement system overhaul in a special session, especially since savings from the reforms were not necessary to finance the measure to help the Ford Motor Co. Viebrock, the chairman of the House Retirement Committee, said the pension issue was a "pretense" that was unnecessary to fund the Ford bill. He said the pension changes could be considered next year.

'BREAD ON THE TABLE'

Ford currently manufacturers F-150 trucks and the SUV Escape model at the Claycomo plant, which employs between 3,700 and 4,000 workers with an annual payroll of $220 million. Ford has given notice that the Escape line will be discontinued there in the fall of 2011, according to union officials. The state is offering incentives in hopes of encouraging Ford to build a new vehicle there. For Ford to get the incentives, it would have to commit to a $200 million plant retooling.

"This is the best shot we have at retaining these good paying jobs," said Rep. Jerry Nolte, R-Gladstone and sponsor of the bill. "This is about families putting bread on the table and keeping a roof over their head by encouraging employers to remain in the state."

While the jobs bill passed overwhelmingly, some lawmakers wondered how the state could forego more tax revenue when it faces a budget deficit of $860 million next year.

"We will have to cut the budget to make up for this money," said Rep. Mike Dethrow, R-Alton.

The House defeated an attempt to remove the subsidies for data center development. Flook said Columbia was a candidate for the location of a facility where computerized documents would be stored and maintained. Flook said if Missouri gets in the business of data storage development, "we can do what Seattle did with software program writing."

PENSION CHANGES

There was less support for the pension overhaul and many lawmakers expressed misgivings over asking state workers to contribute to their pensions after foregoing pay raises and facing higher health-insurance premiums. Viebrock noted that state workers contributed to the plan up until 1972.

Rep. Jeanne Kirkton, D-Webster Groves, successfully amended the bill to keep the five-year requirement for a worker to be vested. The proposed bill would have required 10 years of employment for benefit eligibility.

And the House overwhelmingly defeated an amendment offered by Rep. Andrew Koenig, R-St. Louis County, that would have changed the entire state workers' retirement system from a defined benefit plan to a defined contribution plan.

The House-passed bill does not include what's been proposed in the Senate -- the creation of a new board to handle state pensions.

"If you get the wrong people on there who are looking out for their own best interests or to make a buck, it opens up the option to do something that wouldn't be good for the retirement system," said Rep. Joe Aull, D-Marshall.

 

Terry Ganey, a freelance writer in Columbia, has long covered state government. To reach him contact Beacon issues and politics editor Susan Hegger.

 

 

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