BREAKING NEWS - READ IT HERE FIRST @ 10:51 AM
The controversial $800 million tax credit for a Canadian airplane manufacturer has been killed this morning in the Senate Governmental Accountability and Fiscal Oversight Committee.
The so-called “Bombardier” deal, named after the Canadian airplane manufacturer who would benefit from this tax credit, the largest in state history, was killed in committee this morning by a vote of 5-2, with Senators Jeff Smith (D-4), Rita Days (D-14), Wes Shoemeyer (D-18), Brad Lager (R-12), and Rob Mayer (R-25) voting against it.
UPDATE #2 ON MAY 1ST: A slimmed down version of the deal passed the senate today. In this audio, from Jason Rosenbaum from the Columbia Tribune, Senator Charlie Shields explains the differences:
UPDATE #3: The Senate press release:
Jefferson City — Missouri senators advanced a mega project tax credit plan today allowing the state to work to bring an airplane assembly plant to the Kansas City Region. The measure, House Bill 2393, handled by Senate Majority Floor Leader Charlie Shields, R-St. Joseph, and co-handled by Sen. Luann Ridgeway, R-Clay Co., could trigger a Montreal-based company to invest $400 million into building a passenger jet assembly plant at the Kansas City International Airport.
“We want Missouri to be open for business that brings great paying jobs to our residents,” Shields said. “This is a phenomenal deal for taxpayers, because we have safeguards in place to make sure the company creates jobs before any tax dollars are issued through tax credits.”
The company, Bombardier, has confirmed it is considering a site at Kansas City International Airport to invest $400 million to build a passenger jet assembly plant that, when at full capacity, would employ approximately 2,100 workers paying an average wage of $63,000 annually. These jobs could spur thousands more indirect jobs in the region and state.
The company, which also owns Learjet, would invest a total of $3.2 billion in research, development and structure for the project, but is seeking assistance from Kansas City and the state.
The bill clarifies what the Missouri Department of Economic Development can offer in state assistance through existing programs including the Enhanced Enterprise Zone and Quality Jobs Act programs, capping tax credit investments to $240 million dollars over an 8 year period. The state programs would be coupled with local resources in Kansas City to help bring this aerospace economic development and investment to Missouri.
Ridgeway said Missouri’s plan requires Bombardier to repay tax credits issued by the state.
“We protect taxpayers by not allowing any tax credits to be issued until the company has created jobs. Plus, we would collect royalties on the company’s product, meaning taxpayers recoup the money issued through the tax credits. Ultimately, between the company’s repayment and the new revenue generated from thousands of new jobs, that state and taxpayers would get a net increase of more than $200 million dollars.”The assembly plant would produce a new, fuel efficient, less costly, 110-plus seat commercial aircraft. It will be the first new commercial aircraft assembly facility in America since 1968.
The bill now returns to the House for final approval to become law. To track the legislation visit www.senate.mo.gov and do a “keyword” search for HB2393.
April 30th, 2008 at 12:12 pm
Who were the local representatives who voted for it out of the House?
April 30th, 2008 at 12:28 pm
Rep. Nasheed, Rep. Connie Johnson, Rep. Maria Chapel-Nadal, Zimmerman, Villa.
April 30th, 2008 at 1:09 pm
This puts a smile on my face. I was getting worried about the chances of it going through. This deal would be horrible for Missouri and horrible for us average citizens. I am sure the people supporting this atrocity will come fighting back full force…so we need to be ready for that.
I know I am not ready to see huge cuts in areas to make a foreign company profit and I know I am not willing to pay more taxes for that either. It’s a rotten plan. They can make promises day and night, but they may just be empty promises with no guarantees. Is anyone really willing to take that risk? Let’s hope not. Our state is going through some serious issues these days, ones that need our full attention and resources. This would simply drain our time and money. Why does a huge corporation need incentives anyways if they are so profitable and successful?
April 30th, 2008 at 4:26 pm
Missouri’s republican politicians say our low taxes gives us a comparative advantage over other states, thus business wants to move here. But wait we have to issue a huge tax credit above our rate?
Perhaps low taxes have nothing to do with attracting business?