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JANUARY 16, 2008
"Grow
Me State" Initiative Presented to Missouri
Legislators.
 As the 2008 session begins, the RCGA sent
a booklet to each Missouri legislator presenting the
"Grow Me State" Initiative - a plan to
increase capital formation and small business growth. The
statewide initiative, led by the RCGA, is supported by the
Missouri Chamber of Commerce, Kansas City Chamber of Commerce
and Kansas City Area Development Council, Columbia Chamber of
Commerce, Springfield Area Chamber of Commerce, and Cape
Girardeau Area Magnet. Each of these organizations endorsed
a new, coordinated, and sustainable state policy to
encourage technology-based economic development which includes:
(1) establishing an angel credit tax credit, (2) expanded
funding for the Missouri Technology Corporation, and (3) seed
capital funds and programs which improve the conversion rate of
R&D work and innovation into entrepreneurial firms and
commercially viable products.
Missouri
currently commits $0.10 per capita to capital formation
activities, compared to $2.94 in similar states which are
Missouri's competitors for technology-based economic growth. The
"Grow Me State" Initiative shows how Missouri can catch up, and
recommends that Missouri dedicate $17.2 million for the
following programs:
- An angel tax credit
program to encourage investment in qualified local small
businesses. A 25% tax credit for accredited investors is
proposed with a first-year program allotment of $5 million.
Twenty-one states currently offer an income tax credit of 25% to
50% for investors in early stage businesses.
- $1
million in additional funding for the Missouri Technology
Corporation to secure staffing levels and maintain the
Intellectual Property Management Program and SBIR Revolving
Bridge Loan Program.
- A "Proof of Concept"
Technology Business Finance Program which would award grants to
advanced technology companies for assistance in commercializing
their research into marketable products. This five-year program
would allocate $1.25 million each year.
- A
$10 million Seed Capital Technology Business Finance Program
which would serve as a co-investor into start-up, advanced
technology businesses. The state-funded program would provide a
50% match to privately-invested venture capital.
The "Grow Me State" Initiative is a top priority of the RCGA
2008 legislative agenda, and the RCGA will continue to educate
legislators on the benefits of increasing Missouri's commitment
to technology-based economic development. |
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| RCGA Launches Campaign To Strengthen
Economic Development Tax Credits In
Missouri.
A special RCGAdvocate Issue
Brief, published for
Missouri legislators, demonstrates the value of economic
development tax credits in generating new state
revenue and job growth for Missouri. The issue brief is
the first in a series of papers that advances the RCGA 2008
legislative priority of preserving and strengthening proven
economic development tax credits. Future papers will
highlight several success stories from the Missouri Quality Jobs
Program, Historic Preservation Tax Credit, Enhanced Enterprise
Zone and Brownfield tax credits.
Tax
credit incentives like the Missouri Quality Jobs Program,
Missouri BUILD and the Community College New Job Training
Program have been vital to attracting and retaining Missouri
companies, but their effectiveness is limited by dollar caps and
sunsets. In 2007, the cap was reached on the Missouri
Quality Jobs tax credit, a fact well-known among site
consultants. The risk of caps and sunsets sends a mixed message
around the country regarding Missouri's commitment
and caused them to look at other states, according to Jim
Alexander, Vice President of Business Recruitment for the St.
Louis RCGA. The RCGAdvocate Issue Brief includes
several first-person accounts from the RCGA's Economic
Development team regarding the fierce competition between states
to attract and retain companies, and how incentives make a
difference in a company's decision.
The
future of the state's economic development tax credits is
already under attack with Senate Bill 735 filed by Senator Matt
Bartle (R-Lee's Summit). This legislation seeks a
sunset on all tax credit programs by 2013, unless reauthorized
by the General Assembly. Such looming sunsets would have a
distinct chilling effect on the use of the historic tax credit
for downtown revitalization and on job growth tax credits
that help the St. Louis region's ability to retain and attract
new companies . The RCGA will strongly oppose
legislation which places sunsets on proven economic development
programs.
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RCGA Outlines Ambitious 2008 Missouri
Legislative Agenda
Many Priorities
Reflected in Blunt Administration Proposals
An RCGA
delegation, led by RCGA Chairman Robert
Reynolds of Graybar Electric and RCGA Board Chair for
Public Policy, Steven Lipstein of BJC HealthCare,
will present its 2008 Missouri legislative agenda to
Governor Blunt and leaders of the House and Senate on January
23. The agenda will focus on economic development incentives and
programs necessary to sustain the growth of the St. Louis
regional economy. In just the first two weeks of the legislative
session, several RCGA-supported items have already garnered
support from Administration officials.
The
RCGA has learned that the Missouri Department of
Economic Development is expected to
propose legislation lifting the annual Missouri Quality
Jobs Tax Credit cap from $40 million to $60 million, and
increase the Enhanced Enterprise Zone annual tax credit cap
from $14 million to $24 million. This increase in the
tax credit will bring new jobs and investment to the state. The
new Missouri Quality Jobs tax credit limit will also mean
greater revenue for future state budgets, as companies add new
jobs and make greater investments. The Governor's budget
priorities released on Tuesday proposed one key component
of the "Grow Me State" Initiative, a $5 million angel tax
credit to stimulate entrepreneurial small businesses.
The angel tax credit is part of the $17.25 million
"Grow Me State" initiative to bring Missouri's technology-based
economic development programs up to the same-level as competing
states' programs.
For the third year in row,
Governor Blunt recommended funding of the Life Sciences
Trust Fund. His request for $19.4 million is a $5.9 million
increase from last year. However, this amount falls
well short of full funding, as originally intended in
the statute and supported by the RCGA. The Life
Sciences Trust Fund was established to receive 25% of
the state's tobacco settlement money or approximately $35
million. The RCGA also requests that medical research projects, such as research into
cancer, aging, neurological, and cardiovascular diseases, be
eligible to receive grants from the Fund, as originally
intended by statute. Last year, the Fund was limited to grants
in bioenergy, animal and plant sciences research.
The
Governor's budget enhances Missouri's workforce with
funding increases to higher education institutions and more
financial aid for students to attend college. The Governor
proposed a 4.4% increase ($40 million) in the core operating
budget of state colleges and universities, and he added $28
million for needs-based scholarships, raising the total
scholarship program to $100 million for FY 2009. Math Nearly $3
million additional funding is directed to the METS (Math
Engineering Technology and Science) Initiative for teacher
training and to encourage more students to take Advanced
Placement math and science courses.
Other
RCGA-supported items include $53 million to raise physician
payments in the MoHealthNet program. The increased reimbursement
to 65% of Medicare rates should increase access to care for
low-income individuals and families and strengthen the St. Louis
safety net. The Missouri Arts Council will receive
$14.6 million in FY2009 in the Governor's Budget, $6.8 million
more than last year. This increase will further build our
region's strong arts and cultural institutions. The RCGA also
supports an new tax credit for filling stations to install E-85
pumps, and the proposed budget sets aside $2 million for this
purpose.
The RCGA looks forward to working with the
House Budget Committee, chaired by Rep. Allen Icet
(R-Wildwood) and the Senate Appropriations Committee,
led by Senator Gary Nodler (R-Joplin), to keep
these priorities into the state budget.
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The RCGAdvocate is published
periodically to inform RCGA members and government officials
about important public policy matters at the state, federal and
local levels. It seeks to provide timely, in-depth coverage on
regional issues, and, at times, to call RCGA members to action.
We welcome your comments and suggestions.
Chip Casteel ~ Senior V.P. of Public
Policy ~ (314) 444-1107 ~ ccasteel@stlrcga.org
Susan Stauder ~ V.P. of Infrastructure & Public
Policy ~ (314) 444-1155 ~ sstauder@stlrcga.org
Kevin Riggs ~ Director of Illinois Government Affairs ~ (314)
444-1108 ~ kriggs@stlrcga.org
Eric Schneider ~ Director of Public Policy Research ~ (314)
444-1148 ~ eschneider@stlrcga.org
Christine Snively ~ Project Manager ~ (314) 444-1144 ~ csnively@stlrcga.org
Marlo Young ~ Executive Assistant for Public Policy ~ (314)
444-1134 ~ myoung@stlrcga.org
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In their first action of the new legislative
session, the Illinois General Assembly passed a stop-gap funding
bill for the Chicago transit systems, but failed
to take up the capital bill which would
kick-off critically important highway and education
improvement projects across the state.
