Business groups pleased with legislative success

Several state groups – including the Springfield Area Chamber of Commerce, Southwest Area Manufacturers Association, Missouri Chamber of Commerce and Industry and Associated Industries of Missouri – praise House Bill 327, which changed several economic development laws.

Business boosts

Two programs in particular received a boost from the economic development bill, which awaits Gov. Matt Blunt’s signature.

The bill increased the cap on available funds for the Quality Jobs Act, which allows companies to recover a portion of the tax withholdings on wages from newly created jobs. If signed, the state would make available $30 million for qualifying businesses, up from $12 million. Several area companies, including Duck Creek Technologies and Tuthill Vacuum and Blower Systems, have utilized the program to add jobs.

Sandy Howard, vice president of public affairs for the Springfield chamber, said the program’s $12 million cap was preventing new businesses from receiving the tax help.

“(Raising the cap) will assure that the program continues as an economic development tool, and it’s probably the program we most need in order to be able to attract business to our community,” Howard said.

The Enhanced Enterprise Zone program also received help. The cap for that program, which provides tax credits for companies that expand operations or open new businesses in designated areas, grew to $25 million from $7 million.

Howard said that program has been particularly beneficial for Springfield – several businesses, including T-Mobile, utilized tax credits for building in Springfield’s EEZ.

The bill also included some help for manufacturers in the form of a sales tax exemption. SAMA Executive Director Rita Needham said utility costs are among five key expenses that make it difficult for U.S. manufacturers to compete with their foreign counterparts.

“We have a 31 percent disadvantage in cost, not including labor,” Needham said, noting that there are 10 major countries competing for the same manufacturing dollars. “Profit margins for manufacturers are pretty thin as it is, so anything we can do to help in that is great.”

If signed, the bill would exempt manufacturers from paying sales tax on utilities and chemicals used in the manufacturing process. Missouri currently ranks 43rd nationally in revenue per kilowatt-hour from industrial customers, according to the U.S. Department of Energy.

Concerning health and education

Business groups also were encouraged by the passage of House Bill 818, which includes provisions making it easier for individuals to purchase personal health insurance by deducting the cost of their premiums from state income taxes.

Small businesses would benefit from the bill by having the option of making a defined contribution to individual employees, who could then use that money to buy an insurance plan of their choosing.

“We’re firm believers that this third-party payer system that we’re in is not beneficial to the whole health care system,” said Michael Grote, vice president of governmental affairs for the Missouri chamber. “It doesn’t encourage responsible behaviors. The provisions allowing employees to purchase the health care most beneficial for them is a large step toward better consumer involvement in the health care system.”

The Lewis and Clark Discovery Initiative also passed. The bill, signed by Blunt May 25, allows the Missouri Higher Education Loan Authority to sell out-of-state loan assets to fund building projects on college campuses.

Missouri State University is set to receive $30 million for its Facilities Reutilization Plan, while $5 million will go to the Roy D. Blunt Jordan Valley Innovation Center and $2 million will go to Ozarks Technical Community College.

Left undone

Two issues, however, were not addressed in the session.

One is the state’s minimum wage law. Missouri voters approved an increase in the minimum wage in November, including an indexing provision that allows the minimum wage to increase annually based on inflation.

Grote said state legislators believed that the voters were generally unaware of the indexing provision when they approved the bill; however, a bill that would have repealed the provision passed the state Senate but died in the House.

The House also failed to pass a bill reversing the state Supreme Court decision in Schoemehl v. Treasurer of the State of Missouri, which awarded workers’ compensation benefits to the widow of a beneficiary who died of causes unrelated to the workplace injury.

Grote said that a large number of groups, varying from the Missouri Association of Trial Attorneys to the Missouri chapter of the AFL-CIO, agreed that the state’s Second Injury Fund, from which those payments are to be made, was not designed to handle the possible burden.

However, AIM President Gary Marble said that the Schoemehl decision does not pose as dire a threat as originally believed – he cited several decisions by the state Labor and Industrial Relations Commission that say situations similar to the Schoemehl case would all have to be decided in court, a process that should act as a deterrent.

Marble said the real issue is the Second Injury Fund itself, payments from which were growing even before the Schoemehl decision. He anticipates the legislature will examine the fund’s situation in its entirety in next year’s session.[[In-content Ad]]