Mo. Lawmakers Pass $66M Tax Break Bill

JEFFERSON CITY, Mo. (AP) -- Lawmakers gave final approval Thursday to $66 million a year in new tax breaks, sending Gov. Matt Blunt a bill touted as pivotal to the creation of thousands of jobs.

Under the banner of economic development, the bill would expand or create tax credits for businesses, their investors, developers, beef cattle farmers and movie makers. It even would legalize ticket scalping, which advocates contend could bring jobs to Missouri.

The House sent the bill to Blunt by a 125-19 vote, capping work on the main topic of a two-week special session. The Senate passed the bill 25-7 late Wednesday night.

Lawmakers late Wednesday also sent Blunt a bill that could help speed up repairs to some of Missouri's worst bridges by waiving some of the state's conventional contractor requirements. The project would award a single, 30-year contract to fix and maintain 802 bridges.

Blunt called the special session after vetoing a broader version of the economic development bill passed in May that he claimed could have cost up to $200 million annually while awarding tax breaks to some questionable causes.

The Department of Economic Development has said businesses are waiting to add about 3,000 jobs pending passage of the legislation and several times as many jobs could come to the state as a result of the expanded tax credits.

Some complained that the state was expanding its tax breaks, and thus shrinking its revenues, without considering all of the potential effects.

The centerpiece of the legislation would more than triple the annual tax credits available for certain businesses that add jobs providing health insurance and wages at least as high as the local or state average.

The Quality Jobs program, which also allows those businesses to keep a portion of the income withholding taxes collected for new jobs, had a $12 million annual tax credit cap when created two years ago.

State economic development officials say the program has become so popular that the cap is now insufficient. The legislation would allow the program to offer up to $40 million a year in tax credits.

The bill's most contentious provision would offer $10 million of new tax credits annually, with a maximum of $95 million over time, to developers who buy up large sections of land in impoverished areas.

The measure is backed by developer Paul McKee Jr., who is involved with various business entities that already have amassed hundreds of parcels of land in north St. Louis. Some of those lots are vacant or contain boarded-up buildings.

Entities affiliated with McKee have contributed thousands of dollars to Blunt, Lt. Gov. Peter Kinder and other Republican and Democratic politicians.

Few disagree with the need to improve north St. Louis. But some lawmakers said the legislation's requirement for large projects makes it difficult for the tax credit to be used in other parts of the state, particularly in rural Missouri or potentially even in Kansas City.

Senators voted 25-8 against an amendment that would have stripped the land assembly tax credit from an economic development bill. They also defeated an amendment that would have opened the tax credits up to smaller developments by removing a requirement that the project area encompass at least 75 acres.