The Missouri Chamber of Commerce and Industry isn’t pleased with Gov. Jay Nixon’s vetoes yesterday.
At issue are Senate Bills 591 and 847, which relate to the state’s legal climate, and House Bill 2030, legislation designed to provide tax benefits to companies with an employee stock ownership plan.
‘Judicial hellhole’
Late last year, Missouri placed fourth worst in the nation on the American Tort Reform Association’s annual Judicial Hellholes report.
SB 591, sponsored by Sen. Mike Parson, R-Bolivar, and
SB 847, sponsored by Sen. Ed Emery, R-Lamar, would have helped Missouri move away from that status, according to the chamber.
“The legal climate reform bills passed this session represented a common-sense first step toward moving our state back into the judicial mainstream,” chamber President and CEO Dan Mehan said in the release. “While this veto is very disappointing, it’s not unexpected. Trial attorney special interests are entrenched in Jefferson City, making it incredibly difficult to make any progress toward creating a fair judiciary in our state.”
SB 591 would have required expert witnesses who testify to have knowledge specific to the topic at hand, and SB 847 would limit recoveries in injury lawsuits to only the actual medical expenses incurred.
In his
veto letter, Nixon said SB 591 would replace a well-established system with a more complicated and costly one.
“These changes are not proposed to solve an existing problem, but instead are designed to make it more difficult and expensive for parties to bring forward their cases and recover their proper damages,” the governor wrote in the letter.
Similarly, in his SB 847
veto letter, Nixon wrote the proposed system would have replaced one that’s already proven to work.
ESOP
HB 2030, sponsored by Rep. Denny Hoskins, R-Warrensburg, would have introduced an income tax deduction of 50 percent on the proceeds business owners receive when selling at least 30 percent of the company to employees starting Jan. 1, 2017.
Nixon said the legislation would decrease general revenue collections for the state by as much as $10.3 million a year. In his
veto letter, the governor wrote ESOPs already receive a number of tax benefits, including tax-deductible cash and stock contributions.
“Why create yet another preferential tax treatment for an activity that is already growing in its frequency?” Nixon wrote. “In a fiscal environment in which necessary state services such as education, mental health, transportation and public safety continue to compete for limited resources, it is irresponsible to forgo millions of dollars in revenue to provide special tax treatment for something that Missouri businesses are already opting to do.”
The chamber argues the bill would incentivize business owners to sell their companies to employees rather than close or accept a buyout from a competitor.
“The benefits of employee ownership are proven by research and illustrated by powerful anecdotes from employee-owned Missouri companies,” Mehan said in a separate release. “This bill had enthusiastic support from the Missouri business community as well as from Republican and Democratic leaders in the legislature.”
For all bills in question, the chamber is encouraging legislators to override the governor’s vetoes.
