Wednesday, March 16, 2005
Contact: Spence Jackson, (573)751-0290
Blunt Announces Legislative Package to Create Jobs, Spur Economic Growth
JEFFERSON CITY—Missouri Gov. Matt Blunt today announced a legislative package of economic development reforms to create and attract family-supporting jobs through incentives designed to spur economic growth and create significant opportunities for new job creation.
In an effort to improve Missouri’s economic climate, Blunt announced the Missouri Quality Jobs Act that would establish a withholding tax incentive arrangement for state and local economic development officials to use to attract and create new jobs.
"This is a new approach to economic development in Missouri," Blunt said. "It focuses not just on job creation but on the creation of family-supporting jobs."
The governor’s initiative is divided into three separate programs each with separate qualification requirements: The Small Business and Expanding Business Program; the Technology Business Program; and the High Impact Projects Program.
In order to qualify for these programs, employers must offer basic health insurance for new employees in new jobs and pay at least 50 percent of health insurance premiums for all parts of the program. The new jobs that are created must be at or above the county average wage. Employers would retain a portion of withholding taxes paid to employees in newly created. In addition, an employee would continue to receive full credit for all taxes withheld from their pay. Blunt’s plan is similar to successful programs in Kentucky and Oklahoma.
"Missouri must be aggressive to create and attract new jobs to our state. The Quality Jobs Act I am proposing would give state and local economic developers the proper tools to do just that,'' Blunt said. "By creating and attracting high paying, high-quality, family-supporting jobs, not only do our workers and employers benefit, but so do Missouri families. I look forward to working with the Legislature and Economic Development Director Greg Steinhoff in the weeks ahead to implement the Missouri Quality Jobs Act."
The total amount of tax credits issued for all three components combined would be $12 million per year. The proposed program would be revenue-neutral as it draws from allocations already in place, but not being used to full capacity, from the Rebuilding Communities and Missouri Downtown Economic Stimulus Act programs.
The programs, which would be overseen by the Missouri Department of Economic Development, would allow Missouri to use a portion of withholding taxes on wages paid to employees in newly created jobs as an incentive for the creation of jobs.
In a separate move, Blunt is calling for the combination of the state’s Tax Increment Financing (TIF) cap with the Missouri Downtown Economic Stimulus Act (MODESA) cap which will allow the Department of Economic Development to continue to use TIFs for redevelopment projects as the current program is nearly at its cap. This change addresses Blunt’s concern over past TIF commitments made by the previous administration that may have exceeded the state’s annual TIF cap of $15 million.
Blunt’s plan would also authorize all municipalities and counties to impose a local economic development sales tax with voter approval. Currently, only so-called "charter cities" have this authority.
Blunt held an economic development summit in Jefferson City before taking office with business and community leaders to discuss ways to improve Missouri’s ability to attract and retain new businesses.
"Missouri is competing with 49 other states and several other countries for every job that is created so it is essential that we are aggressive in our efforts to expand and grow our economy," Blunt said. "These changes are essential if we are to successfully bring new jobs to the state. Providing communities with more powerful economic development tools is part of my commitment to expanding business opportunities in Missouri."