The Gadfly is a series of letters offering commentary on local issues and published in the Warrensburg Gazette.
A week or so ago we read of a highly-ballyhooed bill signing; the new law supposedly provides incentives to get companies to expand employment. When any government use the word "incentives" what it really means is giving up tax revenue to favored businesses; it's another word for corporate welfare.
I went to the state website (www.senate.mo.gov) and looked up SB343 to see exactly what it does. First I checked the fiscal note (that's where they estimate the amount of revenue or expense the bill will cause for state and local governments). The estimate is officially "unknown." So we have a tax giveaway bill with no idea of the financial effect on the state.
Then I read the details. Essentially, if a business qualifies by creating a specified number of new jobs paying at or above the county average wage, it gets to keep most or all of the state income tax generated by the jobs. The business is required to pay at least half of the employees' health insurance, which leads me to wonder about cutting subsidized health care for low income people while subsidizing it for those in good jobs.
The bill does more. It increases the amount of money available for Tax Increment Financing (TIF) projects and reduces some of the costs that can be charged to the developer. TIF is the program under which one local governmental body (normally a city) declares an area "blighted" and gives away property tax money from other governmental bodies (normally a county, school district, hospital, etc.) to subsidize the development. That was tried locally back in 1998 when a illegally-structured TIF project for the Applebee's development failed in City Council on a 3-2 vote. TIF has been used in conjunction with eminent domain (condemning property) in other areas of the state.
I'm pro-business, but I think businesses should make their decisions without artificial incentives that skew the marketplace. What government should do to help business is to drop artificial regulations that serve little useful purpose; there's something ironic about government greasing the wheels on one hand while blocking the tracks with the other.
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