(Syndicated to Kansas newspapers April 18, 2016)
Wondering just what legislators are going to talk about—and the governor is going to talk to legislators about—during the upcoming veto session of the Legislature when the biggest issue is whether Kansas can make it through the fiscal year?
Think we’ve found it: Gov. Sam Brownback’s effort to end the border war between four Kansas and five Missouri counties over economic development, job and industry growth in the metropolitan Kansas City area.
That border war, with each state negotiating with businesses to move their headquarters and plants and such into their state, has Missouri companies moving to Kansas and Kansas companies moving to Missouri.
The strategic weapons for that border clash is very simply money. Kansas offers firms bonuses and preferred tax treatment for jobs coming west across the state line, and Missouri does the same thing.
So, if there can be an end to that so-called border war, both states save the money and the tax advantages they now use to lure jobs and economic development across the state line. Sounds like a reasonable but costly battle between the economic development gurus of each state.
Hey, what if companies just make their own decisions based on sound business practices? The four Kansas and five Missouri counties are close, probably no big problem driving to and from work whichever side of the state line an employer is headquartered.
Missouri has a little advantage—being to the east of Kansas—because Kansans driving to Missouri jobs have the sun in their eyes both ways, while Missourians driving to Kansas have the sun at their backs both ways.
But…Brownback’s de-escalation of the battle of financial incentives requires the Missouri legislature in the next few weeks to pass a bill that would strike down statutory tax breaks for firms moving to Missouri while Kansas’ effort…well…it’s mostly a letter to the Kansas Secretary of Commerce to stop offering Kansas’ panoply of lures if and only if Missouri strikes down its tax breaks.
Hmmm…let’s see, Missouri passes a law prohibiting lures for business. Kansas has its secretary of commerce—who is appointed by the governor who has two years left of his term—well, we guess frame, or at least laminate, Brownback’s directive.
Sound a little unequal?
Oh, and let’s not forget that those business-lures come at a cost to the state, which is nearly broke and doesn’t really have the cash to offer those business incentives. So, broke Kansas which can’t afford bullets for its eco-devo gun talks Missouri into unloading its gun by statute.
Kansas would still offer incentives for businesses to move across the state line, including letting businesses which move into Kansas essentially keep for several years the Kansas income tax that would have been paid by only newly hired workers, instead of everyone who crosses the border to go to work as under the current program. Oh, and if a Missouri firm puts up a new building that costs at least $10 million, then the business gets to keep the income tax of all its workers.
Brownback has found a sponsor for a bi-state committee to discuss how to make the plan work, how to cooperate to bring business to the entire Kansas City market area—no matter which side of the state line an enterprise locates.
But, besides the distraction from the state’s budget problems…we’re thinking that the real boon here might be which state gets to cater the lunches and dinners for that bi-state council.
Will Missouri fall for it? We’ll see, won’t we…