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PRESERVING ECONOMIC DEVELOPMENT TAX CREDITS
State tax credit programs, like historic preservation tax credits, brownfield tax credits and distressed communities tax credits are vital to the revitalization of our central core. The Missouri BUILD program and venture capital tax credits are needed incentives to expand existing companies and attract new companies to our region. Job training tax credits assist companies in maintaining a productive and high-quality workforce. Tax credits generate multi-millions of private sector investment dollars that would not have occurred without the public subsidy stimulus.
Support the preservation of tax credits that serve to stimulate economic growth for our region and Missouri. Oppose reductions or
limitations to tax credit programs. Support flexibility of tax credit programs for their use in job retention activities.
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 RCGA Vice Chair for Public Policy Steve Lipstein presents the 2004 Lewis and Clark Statesman Awards to Speaker of the House Rod Jetton. |
AIR QUALITY
In the 2004 legislative session, the Missouri General Assembly considered a proposal to eliminate or radically change the automobile emissions testing (“I/M”) program currently being administered in five counties in the
St. Louis area. That measure ultimately failed, but the issue will likely resurface in the 2005 session. The current centralized I/M program is part of a 10-year “maintenance plan” which became effective in 2003 when the region reached “attainment” or compliance of the national air quality standard for ozone. Additionally, the contract with the program service provider runs through mid 2007. If the I/M program were scrapped or radically altered prior to 2007, U.S. EPA would immediately require that the St. Louis non-attainment area provide an alternative method of achieving emission reductions, pursuant to the Federal Clean Air Act. The alternative method of achieving equivalent emission reductions would most likely target emissions from the region’s smaller businesses such as printers, body/paint shops, bakeries. The state implementation plan for air quality will be revised in 2007 to meet a new, stricter ozone standard for the region. The 2007 version of the I/M program could contain some elements conducive to a decentralized system.
Oppose early termination of the current
I/M program. Support “convenience factor” changes to the program that would not jeopardize this region’s ability to meet federally mandated air quality standards.
ENVIRONMENTAL REGULATIONS
Policies that appropriately balance environmental quality concerns with business needs will lead to well-managed economic growth for Missouri. In the last legislative session, the RCGA Environmental Council won the inclusion of a regulatory impact report in the rules and regulations promulgated by the staff at the Department of Natural Resources (DNR). The regulatory impact report will require the agency to substantiate, both technically and economically, its rationale for rules and regulations promulgated by DNR staff. This year, the Environmental Council continues its advocacy for a balanced application of environmental regulations. One
initiative is the creation of an audit policy by DNR to enable regulated industries to disclose minor violations without fear of unproductive and unnecessary recrimination from DNR. The Environmental Council will pursue a statutory mandate for the Administrative Hearing Commission to serve as a hearing officer for all appeals before citizen commissions. Both of these changes will improve the business climate without jeopardizing environmental quality.
Support the establishment of audit policy and pre-enforcement notification policy. Support legislation to allow the Administrative Hearing Commission to adjudicate appeals of contested permit denials/conditions brought before the citizens’ commissions. Support reauthorization of the Waste Tire Fee and the Hazardous Waste Fee sufficient to fund basic programs. Seek safeguards to assure that program-specific fees are protected for their intended purpose. Support a clearly and narrowly defined set of qualifiers related to standing in third party appeals before citizen commissions. Develop institutional control mechanisms to fully implement the state’s new risk-based clean-up action program. Implement a “licensed site professional” program for use by DNR in permit process.
SMALL BUSINESS EXPANSION
The fastest growing segment of the
St. Louis regional economy is the small business sector. In the St. Louis region, there
are nearly 50,000 businesses with under
50 employees. These small businesses employ 342,000 and have a total payroll of $11.3 billion. The strength of small businesses is a key part of the state’s economy, but more needs to be done to improve their ability to expand. Small businesses can grow when there is infrastructure that encourages and supports entrepreneurs; however, such a
supportive environment does not exist in Missouri. Small businesses face challenges in accessing capital, obtaining private and public contracts, training their workforce, purchasing affordable health insurance. Missouri is the only state that does not fund its statewide Small Business Development Center. The state’s goals in participating in contracts with women-owned business enterprises have not been met. Tax credits authorized for small business incubators have not increased for years. Options to purchase affordable health insurance are limited. Missouri must aggressively work to improve the environment for small business in order to increase job growth.
Encourage policies that stimulate an entrepreneurial culture and enhance the growth of small businesses. Direct funding for specific small business programs and tax credits.
Support policies that encourage greater access to markets for women business enterprises in public and private sectors. Support accountability and enforcement measures to ensure that the State of Missouri meets or exceeds its targeted goals for women business enterprises.
INCREASED REGIONAL TRANSPORTATION FUNDING
Without increased transportation funding, economic growth in our region will be stifled. When the voters’ rejected the transportation-funding referendum in 2002, critical regional improvements to our roads, bridges, and transit system were shelved. In this environment, it is essential that the state Highway and Transportation Commission dedicate to the St. Louis area its fair share of funding.
Support principles of equity by which the
St. Louis region would receive 33 percent of new State highway revenue, 50 percent of State transit revenues.
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| Passage of Amendment 3 in 2004, supported by the RCGA, will result in more road money for the St. Louis region. |
STATE APPROPRIATION FOR PUBLIC TRANSIT
Stable funding for the region’s transit system is essential for long-range service and capital planning. Missouri has reduced transit funding statewide, forcing severe budget cuts and fare hikes at Metro. In the last three years, state funding for Metro has declined by 65 percent from $4.0 million to $1.4 million.
Support increased funding for transit statewide. Support increased appropriations for Metro.
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| Stable funding for the region’s transit system is essential for continued bus and rail service and capital planning. |
TELECOMMUNICATION SERVICES
The availability of reliable telecommunications infrastructure and new generation telecommunications services is a very important decision factor for businesses choosing to locate or expand in a region. High-speed telecommunications is essential to business productivity and operations.
Support policies that encourage investment in technology infrastructure and promote customer choice. Support policies that establish equal regulatory treatment of all providers
of telecommunication services in order to enhance infrastructure investment and maximize consumer benefits from competition.
TRAUMA CENTER
Trauma is the leading cause of death among Missourians under 35 years old, and among
children it claims more lives than all other
diseases combined. Trauma centers and their life-saving services are vital to the health of a community, but the high cost of maintaining trauma services and insufficient reimbursement can place an enormous financial burden on a hospital. The total cost of unreimbursed hospital care at Missouri’s major trauma centers exceeds $44 million a year, and a stable long-term funding source has not been established.
Pursue additional funding for trauma centers to maintain high-quality health care services for the St. Louis community.
ROAD SAFETY
Each year 89 people die on Missouri roads, because they chose not to use their seat belt. Seat belts have proven to save lives and reduce serious injuries, yet Missouri’s safety belt usage rate remains consistently lower than the national average. A primary seat belt law would enable law enforcement officers to ticket motorists based solely on an observed seat belt violation. The twenty states with a primary seat belt law experienced an 11 percentage point increase in their seat belt use rates. This increase would save $5 to $10 million annually to the Missouri’s Medicaid program from prevented deaths and traumatic injuries. The federal government is encouraging states to improve their road safety. In the upcoming reauthorization of the federal transportation bill, Missouri could receive $17 million in increased highway funding if a primary seat belt law passes.
Support passage of the primary seat belt law.
PLANT AND LIFE SCIENCES
The St. Louis region is a world-class leader in plant and life sciences research. The State of Missouri should play a crucial role in translating this research base into a thriving business
sector by investing in public resources to leverage significant private investment. Starting in fiscal year 2007, the Life Sciences Trust Fund will receive 25 percent of the tobacco settlement funds. The fund will allocate resources to build research capacity and to promote life sciences technology transfer and commercialization. However, in each year a majority vote of the General Assembly can rededicate money from the Fund back to general revenue.
Support programs and policies that further development of wet lab space and incubators. Support programs and polices that grow venture capital funds and support commercialization efforts. Support programs that encourage university/business collaboration and strengthen the workforce for the industry. Oppose attempts to transfer money from the Life Sciences Trust Fund into general revenue. Provide for a higher tax credit for smaller companies located in distressed communities.
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| On Dec. 16, 2004, CORTEX, the Center of Research, Technology and Entrepreneurial Expertise, broke ground on the first building in its life sciences and research development. (Left to right): Fred Goebel, HOK; John Dubinsky, CORTEX; Steve Lipstein, BJC HealthCare; Larry Shapiro, Washington University School of Medicine; Dr. Peter H. Raven, Missouri Botanical Garden; Mayor Francis Slay; Bob Clark, Clayco Construction Company; and Kathleen Brady, Saint Louis University. |
STEM CELL RESEARCH
The life sciences industry is a critical element of our region’s economic development future. Our region must provide a welcoming environment for medical research. Limitations on research will put the St. Louis region at a
competitive disadvantage in attracting and retaining scientists, entrepreneurs, and life sciences companies.
Support our region’s research community by allowing researchers to conduct stem cell research, including research associated with adult, cord blood, early stage stem cells no later than the blastocyst, and those derived from somatic cell nuclear transfer. Oppose human reproductive cloning.
SEED CAPITAL TAX CREDIT
Since 1999, the Seed Capital Tax Credit, which encourages investment into small, emerging businesses located in distressed communities, has been exhausted. The Center for Emerging Technology in St. Louis and other Innovation Centers around Missouri play a crucial role in deciding which companies receive investments under the tax credit program and who should share in an equity interest and profit.
Support increased funding for the Innovation Centers. Support legislation that authorizes the State to issue $5 million per year and a 60 percent tax credit to those who invest in qualified emerging companies that are located in distressed communities.
CAPITAL TAX CREDIT
The State Capital Tax Credit has been a very successful program in leveraging smaller, individual investors into emerging companies. However, the program fund has been exhausted since 1999. Furthermore, the program is relegated to companies whose principal owners have at least 50 percent ownership in the company. With the resources and capital that is required to start companies today, especially in the high-tech field, 50 percent ownership of a company is rare.
Support legislation that authorizes the State to issue $6 million a year for Capital Tax Credits for those who invest in qualified, emerging companies. Reduce the ownership requirement to 20 percent. Support state
policies that expand venture capital in Missouri.
HIGHER EDUCATION AND WORKFORCE DEVELOPMENT
The growth and productivity of the Missouri and the St. Louis regional economy greatly depends upon the skills and qualifications of its citizens. Our region’s workers must be properly prepared to meet technological and educational requirements if they are to succeed in a competitive global market.
Support increased job training funding to provide training for new and expanding businesses. Support collaborative partnerships with schools, community colleges, community-based organizations and businesses to enhance and improve educational opportunities for all
students. Support increased funding for workforce training and skills development with special emphasis on advanced manufacturing, information technology and life sciences.
K-12 SCHOOL FUNDING
Strong public schools are a significant component of a strong business environment, providing a high quality workforce and a high quality of life. Missouri policy makers are
considering a new or revised foundation
formula to distribute basic state aid to public school districts. When the funding formula was last modified in 1993, many school districts in the St. Louis region had their state allocation frozen. Although state funding has remained at the 1992 levels for these districts, the costs of educating students has continued to rise. Local school districts have increasingly relied on local taxpayers to make up for declining state support. Several local school districts in St. Louis County now receive less than 10 percent of their revenue from the state. A lawsuit filed last year alleges that the school funding formula is inadequate and inequitable for Missouri students. The court could rule in 2005 that the current school funding formula is unconstitutional and could require the Legislature to write a new funding allocation. The St. Louis region must be vigilant to ensure that the new
formula does not harm local or state funding for our area’s public schools.
Support a new foundation formula that ensures that no St. Louis-area school district will receive less total state aid than under the current formula. Support a new formula that is more equitable to our region’s schools. Oppose any effort to transfer revenues paid by local property taxes to the school foundation formula. Require uniform assessment practices in each county. Provide favorable recognition for local effort in the new formula. Support a new formula that contains regional cost factors and adjustments to account for the needs of students. Support a formula that provides for future inflationary cost increases.
MISSOURI HIGHER EDUCATION SAVINGS PLAN (MO$T)
Like all states, Missouri offers a 529 higher education savings plan to encourage savings for postsecondary education. Earnings in the plan are free from federal and state taxes if used for qualified higher education expenses, like tuition, fees, room and board, books or supplies, at any accredited post-secondary institution in the United States. Additionally, contributions are Missouri state tax deductible up to $8,000 per taxpayer per year. Missouri residents who want to take advantage of these tax savings must enroll in the MO$T plan. The MO$T plan is currently operated by one fund manager who offers three investment options; however, the fund manager’s contract expires in 2005. The 529 savings plans have become one of the most popular methods for college savings and Missouri residents should be able to choose a 529 plan which best suits their needs.
Support competition among 529 higher education savings plans to allow greater options for Missouri residents. Support the continuation of the state income tax deduction for participation in the 529 higher education savings plans. Support initiatives that encourage investment and improved educational opportunities for Missourians.
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| Lt. Gov. Peter Kinder |
UNIVERSITY OF MISSOURI - ST. LOUIS
As a primary provider of the college-educated workforce for the St. Louis region, the strength of the University of Missouri–St. Louis directly impacts the strength of the regional economy. For the last several years, state appropriation to UMSL has not been commensurate with its mission to become a first class teaching and research institution. Upgrading facilities and programs at UMSL is critical for our region’s capabilities in science and technology and for creating job opportunities in the new economy.
Support increased funding for the University of Missouri–St. Louis to address the system-wide funding equity issues. Support funding for the continued implementation of the campus master plan toward the completion of the Business, Technology and Research Park. Support appropriations to renovate the teaching and scientific research laboratory space at Benton and Stadler Hall.
HARRIS-STOWE STATE COLLEGE
Harris Stowe is the only Historically Black College in the region, and has an over 100-year history of preparing our nation’s teachers. In 1993, the College was authorized to expand its mission to address the higher education needs of metropolitan St. Louis in key applied professional disciplines. In order to fulfill this expanded mission, a campus expansion plan is underway at the college.
Support funding for the completion of the buildings and infrastructure outlined in the Harris-Stowe Campus Expansion Master Plan.
COMMUNITY COLLEGES
Our region’s community colleges enhance the educational opportunities and provide a vital role in the education and skill development of our region’s workforce. Community colleges also provide substantial economic benefits to our region, returning $7 of economic activity for each tax dollar invested.
Support appropriation of $15 million to
fund Community College Job Training
Program for retained workers as enacted
by the “Jobs Now” bill. Support efforts to
reach full funding for community colleges. Support capital funding for maintenance and repair of buildings and equipment. Support funding for life sciences initiatives at community colleges that encourage job training and workforce development.
ARTS FUNDING
Cultural and arts organizations enrich the quality of life of our community and play an important role in recruiting top-notch workforce talent. Nearly 13 million people annually attend cultural and artistic events in our region, creating 4,400 jobs and generating an economic impact over $700 million. Many cultural and arts organizations rely on the Cultural Trust Fund for support. Established in 1994, the Cultural Trust Fund statutorily receives revenues from the taxes placed on the earnings of professional athletes and entertainers who play or perform in Missouri. Sixty percent of the fund’s revenue is statutorily directed to the Missouri Arts Council Trust Fund. Over the last three years, the athletes and entertainers tax generated over $80 million, yet the Cultural Trust Fund received none of that revenue. When the Legislature
redirected that money for general revenue purposes, the Missouri Arts Council tapped into its endowment to support area arts
programs. Now that Fund is close to depletion. The St. Louis region has benefited from the vibrancy of the arts community, and a healthy, stable funding source is a necessary ingredient for regional economic growth.
Oppose the diversion of funds and restore full funding to the Missouri Arts Council and Cultural Trust partners, as defined in state statute. Oppose any attempts by other groups to receive revenue from the athletes and entertainers tax.
HISTORIC PRESERVATION TAX CREDITS
Historic tax credits greatly assist and leverage private investment in the rebuilding and renovation of historic properties. Without historic tax credits, Cupples Station, the Convention Center hotels, the Chase Park Plaza, the City Museum, and Washington Avenue Loft District would not have been brought back to life. Historic tax credits help to rebuild neighborhoods and towns across the region and the State of Missouri. A study by RBG & Company demonstrated a 2:1 return on the state’s investment from the historical tax credit on major projects in the St. Louis area.
Oppose changes to the Missouri Historic Preservation Tax credit program. Oppose efforts to cap or reduce the historic tax credit. Maintain the transferability of the tax credit.
BROWNFIELD REDEVELOPMENT GRANT PROGRAM FUNDING
Brownfield sites are idle or abandoned industrial sites that remain undeveloped due to known or perceived environmental contamination. Redevelopment and reuse of these properties is inhibited by four factors: uncertain liabilities, unrealistic cleanup standards, lack of financing, and the uncertain regulatory process.
Support an increase in the appropriation to the Brownfield Property Reuse Fund. Oppose changes that would reduce access to brownfield tax credits.
CONTIGUOUS PROPERTY REDEVLOPMENT FUNDING
As part of the brownfield redevelopment
legislation passed by the Missouri Legislature in 2001, a contiguous property redevelopment fund was established. The Contiguous Property Redevelopment Fund will provide grants to cities and counties to assist in acquiring multiple contiguous properties for redevelopment into a private enterprise. This fund is not currently funded. Once funded, this fund will greatly enhance large-scale development in distressed areas of the St. Louis region.
Support an appropriation to the Contiguous Property Redevelopment Fund to provide money for cities and counties to acquire multiple contiguous properties. Support legislation that will help in the land assembly process in older urban areas.
TORT REFORM
Last session, Gov. Holden vetoed a tort reform bill that would have substantially reduced employers’ exposure to outrageous liability settlements. The bill would have provided a single cap on non-economic damages in medical malpractice cases. A new definition for joint and several liability would have appropriately allocated each defendant’s potential liability in a lawsuit. The bill also would have reduced “venue shopping” a legal tactic that serves a barrier for companies to locate a business
in the City of St. Louis. Venue reform,
medical malpractice insurance reform, and improved definitions of joint and several liability and venue must be included in future tort reform legislation.
Oppose any attempts to separate medical malpractice reform from comprehensive business tort reform. Support legislation capping non-economic damages in all liability cases. Oppose cost of living adjustments to the non-economic damages cap. Support a separate non-economic damages cap for trauma cases. Enact language that distributes liability awards by the percentage of fault attributed to each defendant. Support a definition of venue as the county where the tort action occurred.
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| Gov. Matt Blunt |
WORKERS' COMPENSATION
For the last two years, comprehensive workers compensation reform has stalled in the General Assembly. Legislation has sought to change the definition of a workers compensation accident to be a specific incident identifiable by time and place of occurrence. The bill also would have required that an injury or occupational disease be compensated only if the accident or occupational exposure was the dominant factor in causing the condition or disability. The current law allows compensation if the workplace accident or exposure was the substantial factor in causing the condition.
Support appropriate changes in the Workers’ Compensation law to encourage economic development and provide more job opportunities in Missouri.
LOSS LIMITS
Missouri law restricts a customer from spending more than $500 every two hours—the only state that imposes such a limit. The Missouri Gaming Commission has consistently reported that the loss limit makes Missouri casinos less competitive than casinos in neighboring states. No evidence indicates that loss limits restrain problem gamblers. In a Gaming Commission survey of problem gamblers who have placed themselves in Missouri’s voluntary exclusion program, 90 percent said the $500 loss limit did not prevent people from becoming problem gamblers. A lifting of the loss limits could raise $53 million a year in new revenue to the state due to increased customers to Missouri casinos. Statutorily, the new tax revenue would be directed to education, veterans, the state’s college student loan program, the National Guard, early childhood development programs and gambling addiction programs.
Support of repeal of the $500 loss limit in Missouri’s casinos.
RIGHT TO REPAIR
The home building industry is a major driver of the St. Louis regional economy, creating thousands jobs in the construction, material supplies and financial services industries. Home builders are confronting a liability insurance crisis due to excessive construction defect litigation. Right to Repair, also known as Notice and Opportunity to Repair legislation, provides homeowners with a process to have construction defects corrected in a timely manner. This process requires homeowners to notify builders of alleged construction defects before commencing litigation. Builders are granted the opportunity to inspect and offer to repair the defects, or to monetarily settle the claim. The homeowner’s retain their right to seek legal action throughout this process. Right to Repair statutes exist in 23 states. Last year, right to repair legislation overwhelmingly passed the Missouri General Assembly, but was vetoed by Gov. Holden.
Support right to repair legislation as a common sense alternative to resolve home construction defects and avoid costly litigation.
CERTIFICATE OF NEED
The majority of residents in our community receive health insurance through their employer; therefore, businesses have a strong interest in controlling the health care costs. The proliferation of excess medical capacity can increase health insurance premium costs to employers. Current regulations have contained health care costs through oversight of unnecessary medical capital expenditures; however, specialty providers do not receive the same degree of oversight.
Support changes in the certificate of need regulations to ensure a level-playing field between hospitals and specialty providers.
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| Senate President Pro-Tem Michael R. Gibbons is congratulated by John Bachmann, senior partner, Edward Jones; for his 2004 Lewis and Clark Statesman Award. |
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