Missouri Senate considers Angel investment tax credits

Another round of economic development legislation was heard in the Missouri Senate Jobs, Economic Development and Local Government Committee this week, gathering the support of the business community.

Senate Bill 698, sponsored by Kansas City Sen. Jolie Justus, would provide tax credits to investors that provide early stage “angel” capital to qualified employers in the state and would be administered by the Missouri Technology Corporation (MTC) with the primary goal of encouraging individuals to provide seed-capital financing for emerging Missouri businesses engaged in the development, implementation, and commercialization of innovative technologies, products, and services. This bill, unlike many tax credit bills, has a ten year sunset provision.

“You can have a great idea, but without a little bit of seed money or a little bit of assistance, you won’t be able to get the idea off the ground,” Tracy King, vice president of governmental affairs for the Missouri Chamber, said. “This is about investing in individuals and ideas and allowing the entrepreneur to create the newest market and the newest product; this is the basis of all economic development.”

The committee took no action on the bill but may vote on the bill next week.

The Missouri Chamber is supportive of Angel investment tax credits and has testified in favor of similar legislation in the House.  For more information about tax issues, please contact Tracy King, vice president of governmental affairs for the Missouri Chamber, at tking@mochamber.com or by phone at 573-634-3511.

Missouri Chamber opposes minimum wage increase

The Missouri Chamber of Commerce and Industry, alongside other business advocates, voiced strong opposition this week to a proposal to sharply increase the state’s minimum wage.

Senate Bill 531, sponsored by Sen. Jamilah Nasheed, D-St. Louis, would raise Missouri’s minimum wage to $10 per hour. Missouri’s current minimum wage is $7.50 an hour.

The floor for tipped wages would also rise from 50 percent to 60 percent of the minimum wage. In addition, the bill would require cost of living increases each year.

Sen. Nasheed is proposing to have voters decide on the change.

The Missouri Chamber joined a host of other businesses and organizations testifying against these attempts to drastically increase costs for companies that employ minimum wage workers.

The Missouri Chamber noted that as wages increase, businesses are forced to try to hold overall salary expenses in check. Often, they achieve this by actually reducing their workforce.

“The negative impact of this proposal will fall directly on the people it is attempting to help. While minimum wage employment is seldom considered a dream job, these jobs provide a valuable place to start and offer workers something to build upon,” said Jay Atkins, general counsel for the Missouri Chamber. “By raising the cost of providing these jobs to Missouri workers, we are closing the entry point to our workforce. This is bad for workers, and it’s bad for our state’s economy.”

The bill was heard this week in the Senate Small Business, Industry and Insurance Committee. No vote was taken.

Those backing the increase have also filed an initiative petition but have not begun gathering the signatures needed to place the change on the ballot. The new minimum wage would go into effect in 2016.

For more information on this issue, or to share how this proposal could impact your business, please contact Jay Atkins, general counsel for the Missouri Chamber, at jatkins@mochamber.com or by phone at 573-634-3511.

Missouri Chamber supports effort to establish Prescription Drug Monitoring Act

In an effort to rein in drug abuse throughout the state, House Bill 1133 was third read and passed by the House this week.  The bill is sponsored by Rep. Kevin Engler, R-Farmington, and supported by the Missouri Chamber.

The act would establish the Prescription Drug Monitoring Act and would change the laws regarding the prescribing and dispensing of controlled substances.  The act would require the Department of Health and Senior Services to establish and maintain a program to monitor the prescribing and dispensing of all Schedule II through Schedule IV controlled substances by all licensed professionals who prescribe or dispense these substances in Missouri.  The person dispensing the drugs would then be required to electronically submit to the department information for each prescription. The bill would also require the department to establish a statewide pilot project for reporting fraudulently obtained prescription controlled substances.

“Missouri is the only state that does not have this program in place,” Jay Atkins, general counsel for the Missouri Chamber, said. “Forty nine other states have enacted this legislation. If Missouri had a central prescription drug monitoring program, it would block criminals from other states coming to Missouri to fill multiple prescriptions. This is common-sense legislation.”

The act would also require all submitted prescription information to be kept confidential with specified exceptions.  The department would then review the information and, if there is reasonable cause to believe a violation of law or breach of professional standards may have occurred, they would then notify law enforcement.

The bill would also require the department to maintain a registry of people who might reasonably be considered to have violated any prescription drug laws, and they would stay on the registry for a minimum of three years. Any person who violates provisions of the act could receive a $1,000 fine for each violation.

Several business organizations, including the Missouri Chamber of Commerce and Industry are members of the Missouri Prescription Drug Monitoring Program NOW Coalition, which is a strong proponent of this legislation.

For more information about this legislation, please contact Jay Atkins at jatkins@mochamber.com or by phone at 573-634-3511.


Proposals would curb governor’s power to withhold from education

Following years of watching Gov. Jay Nixon withhold funding they had appropriated for schools, Missouri lawmakers are considering legislation that would strip or reduce the governor’s power to withhold from education.

During the summer of 2013, Gov. Nixon temporarily took $66 million from the General Assembly’s appropriation for K-12. The governor’s move came as lawmakers were considering overriding his veto of a tax cut bill. The education withholding was part of the governor’s overall $400 million funding freeze. Most of that funding was later released following the legislature’s unsuccessful attempt to override his veto.

Two lawmakers this session are offering constitutional amendments to change this dynamic. A Senate proposal would disallow the governor from withholding from K-12 education while a House proposal would give lawmakers new powers to override the governor’s school funding freezes.

Sen. Ryan Silvey, R-Kansas City, has sponsored Senate Joint Resolution 45, which was approved unanimously by a Senate committee this week. Sen. Silvey’s proposal would hold K-12 education funding and debt payments as untouchable by the governor once they have been appropriated.

Silvey said his joint resolution amounted to ensuring “that money we’ve appropriated actually makes it to its intended purpose.”

Also this week, the House Committee on General Laws passed legislation sponsored by Rep. Todd Richardson, R-Poplar Bluff. Rep. Richardson’s proposal differs from Sen. Silvey’s in that it would retain the governor’s ability to withhold education funding while giving new power to the General Assembly to override the governor’s withholdings. Rep. Richardson’s legislation is House Joint Resolution 72.

During Senate testimony on Sen. Silvey’s proposal, education proponents testified that the governor’s withholdings have made financial planning extremely difficult. They said that if the constitution was changed and the legislature’s appropriations were the final word, there would be much greater stability as school districts plan their budgets.

The constitutional change would also further clarify that educational funding should be held as a priority over nearly all other state expenses. The state’s constitution already has a section describing the order of how state money should be appropriated. Education is listed second, after only paying the state’s debt.

The Missouri Chamber of Commerce and Industry supports changes that provide stability and give appropriate funding to our state’s education system as today’s business leaders will need highly educated workers to compete in a global marketplace.

For more information about education issues please contact, contact Tracy King, Missouri Chamber vice president of governmental affairs, at tking@mochamber.com or by phone at 573-634-3511.

Missouri Senate takes on Whistleblower Protection Act

This week the Missouri Senate discussed Missouri’s Whistleblower policy and what the legislature can do to protect those who speak out on wrongdoing in the workplace. Heard in the Senate Judiciary and Civil Jurisprudence Committee, Senate Bill 490 would protect employees that are the whistleblowers that report illegal workplace conduct, and is sponsored by Sen. Brad Lager (R-Savannah). The proposed legislation would also provide legal protection to employers.

Sen. Brad Lager introduces his bill to clarify Missouri's whistleblower statutes.

Sen. Brad Lager introduces his bill to clarify Missouri’s whistleblower statutes.

Sen. Lager told the committee Monday that a court ruling a few years ago dramatically changed the way that ‘whistle blower’ was interpreted in our state.

“We want to take it back to the way it was,” Lager testified, “In order for there to be a whistle blower protection, there actually has to be a finding of something wrong happening.”

The bill would make it an unlawful employment practice for an employer to discharge or retaliate against an individual who is a protected person under the whistleblower protection.  The bill would then become the exclusive remedy for any and all unlawful employment practices and puts a cap on the amount of damages a person can receive.  However, a court may award the plaintiff actual and punitive damages.

This Missouri Chamber is supportive of this legislation.  Jay Atkins, general counsel for the Missouri Chamber of Commerce and Industry, testified on behalf of the bill.

“Those who oppose this legislation argue that potential plaintiffs will be unable to file litigation because the definition of protected person under the bill is more stringent than what currently exists in common law.  However, employers and employees are best served by having this standard established in statute.”

The committee did not take any action on this bill.  For more information about employment law, please contact Jay Atkins, general counsel for the Missouri Chamber of Commerce and Industry at jatkins@mochamber.com or by phone at 573-634-3511.

House committee hears legislation that would change prevailing wage laws

The Missouri House Workforce Development and Workplace Safety Committee took on legislation this week that would reform prevailing wage laws in Missouri.

House Bill 1306, sponsored by Rep. Warren Love, R- Osceola, would change the laws regarding the prevailing hourly rate of wages, and would revise the definition of construction as it relates to prevailing wages on public works projects by removing improvements, alterations, or major repairs and specifies that it does not include maintenance work. Currently the law includes construction, reconstruction, improvement, enlargement, alteration, painting and decorating or major repair.

The Missouri Chamber has a long-standing position against prevailing wage mandates.

“Prevailing wage is a product of a bygone era.  The policy mandates an arbitrary level of wage-setting on public projects,” Jay Atkins, general counsel for the Missouri Chamber, said.  “That mandate is costing taxpayers far greater costs for public projects. In some areas of the state, it could nearly double the wage level on taxpayer-funded projects compared to wages for other local construction projects.”

For more information about prevailing wage issues, please contact Jay Atkins, general counsel and director of governmental affairs for the Missouri Chamber, at jatkins@mochamber.com or by phone at 573-634-3511.

Missouri Chamber testifies against legislation to block retail activity on certain holidays

The Missouri Chamber of Commerce and Industry opposes legislation that seeks to halt retail sales on Thanksgiving, Easter and Christmas. Tracy King, Missouri Chamber vice president of governmental affairs, testified in opposition to House Bill 1284, legislation sponsored by Rep. Keith English, which the Missouri Chamber says would hurt residents, employers and workers in our state.

“This is a return of the ‘blue law,’ outdated policy that almost all states have eliminated. Currently, Rhode Island, Maine, and Massachusetts are the only states that have these so-called ‘blue laws,’ and lawmakers in these states are looking to repeal them. Don’t take Missouri backwards,” King said.

Under HB 1284, any sale for retail is prohibited by this bill.

“The sick and injured won’t be allowed to purchase medicine at pharmacies. Travelers both in this state and out of state won’t be able to purchase gas as they travel through Missouri on the holiday,” King warned.

According to members of the Missouri Chamber, retailers do not have any problem finding workers who want to work the holidays, often earning more than average wages.

The legislation is also an infringement on free enterprise, eliminating an opportunity to add to our state’s economy.

“If consumers didn’t want to shop on these holidays, retailers would not be open,” King said. “If Missouri limits retail sales on these days, consumers that are close to state lines will take their shopping across the borders.”

The 2013 Veto Session is an opportunity to block $1.5 billion attack on employers and working Missourians

In a few days, Missouri lawmakers will return to Jefferson City for the 2013 Veto Session and the stakes are high for Missouri employers.

“Most of the attention of this veto session has been on the much-publicized House Bill 253,” said Missouri Chamber President and CEO Dan Mehan. “However, there is more at stake than many realize, especially for Missouri employers. This isn’t a veto session, this is going to be a jobs session.”

The Missouri Chamber of Commerce and Industry will be heavily rating three override votes, in addition to the vote to override House Bill 253.

House Bill 611

Failure to override veto risks more than $330 million in state funds and an $859 million tax increase on employers. Employers could see tax increase of up to $420 per employee.

Gov. Nixon vetoed House Bill 611, legislation that will keep Missouri’s unemployment insurance program in compliance with federal mandates and protect federal funding that Missouri employers receive. The mandates were required under the federal Trade Adjustment Extension Act of 2011, and are billed as a way to combat fraud and protect the integrity of states’ unemployment funds. The bill also contained language to broaden the definition of misconduct so that employees fired for infractions such as stealing from their employers or doing drugs on the job would be blocked from unemployment insurance benefits. This provision is where Gov. Nixon had issue with the bill.
“He chose trial attorneys over Missouri employers and in the process is risking an $859 million tax increase on Missouri employers,” said Mehan.
Failure to meet compliance has heavy price tag, according to correspondence the Missouri Chamber received from the Missouri Department of Labor. During the legislative session, the Labor Department told the Missouri Chamber that employers would lose FUTA tax credits – $859 million annually — without passage of the mandates. The department also claimed Missouri would lose federal grants – approximately $46 million – the state receives each year to help administer the unemployment compensation system. The department also outlined $13 million in federal funds the Department of Economic Development-Division of Workforce Development receives each year to administer re-employment services. In addition, non-compliance would also jeopardize all federal funding for the Tile IV-D program – more than $58 million, according to the Missouri Department of Labor. The Labor Department also claimed that non-compliance would risk the loss of federal funding for the Temporary Assistance for Needy Families (TANF) program – up to $217 million. In this correspondence, the Missouri Department of Labor strongly urged the Missouri Chamber of Commerce and Industry to secure passage of the mandate language.

In August, the Missouri Chamber submitted a Sunshine Request to the Missouri Department of Labor requesting all correspondence the state had with the US Department of Labor in an effort to uncover the threat facing employers by falling out of federal compliance. That information is still pending.

The Missouri Department of Labor has filed emergency and permanent rules in an attempt to bring Missouri in compliance with the mandates – a move the Missouri Chamber suggests goes beyond statutory authority.

“The Missouri Chamber does not believe this is a prudent approach,” Mehan said. “It’s an end-run around the legislature and we question the legality. If one person sues, it will put our entire unemployment insurance system at risk.”

House Bill 650

The veto of House Bill 650 risks hundreds of jobs.

Gov. Nixon’s veto of House Bill 650 was also a choice of trial attorneys over employers. The legislation was especially important for the Doe Run Company, the largest lead producer in the Western Hemisphere, which is based in St. Louis. The legislation was critical for preserving the 1,500 jobs at the company.

One of the key benefits of House Bill 650 for Missouri employers is a provision that would provide successor liability tort reform by capping punitive damages that can be assessed against employers from actions of previous business owners. This provision is aimed at providing common-sense protections for employers in particular the mining industry, which provides thousands of Missouri jobs and significant revenue to our state.

“Gov. Nixon had to veto this to placate the trial attorneys who have given Gov. Nixon a large portion of his political funding,” said Mehan. “He can talk all day about how committed he is to Missouri employers, but when it comes down to a choice between jobs and the trial attorneys, he has left employers in the dust every time.”

House Bill 339

Veto blocks common-sense insurance measure.

House Bill 339 would prohibit an uninsured driver from collecting non-economic damages in a civil action against an insured motorist at fault for an accident.

The Missouri Chamber will also push to override this veto.

“We support the insurance industry in this measure against drivers who are breaking the law by not carrying insurance,” Mehan said.

Final tally

The total cost for employers as a result of House Bill 253, House Bill 611, House Bill 650, and House Bill 339 could be more than $1.5 billion.

“Gov. Nixon will have the legacy of the largest collective tax increase on Missouri employers and workers in state history,” said Mehan.

We urge lawmakers to override his dangerous veto pen.

Brunner Blog: The Tax Cut of the Century

The following is a blog post by John Brunner to his personal blog, JohnBrunner.com

This September, the Missouri legislature has the opportunity to do something that hasn’t been done in nearly 100 years; cut income taxes for every Missouri family, small business, and farmer. For the first time in a century, we have a chance to plug the hole in job losses to states that have already gotten competitive on taxes and regulations. Our Missouri legislature is set to take a step in the direction of growth and opportunity. We don’t have to be at the bottom of the barrel any longer. We can get Missouri working again!

After passing the tax cuts with overwhelming bipartisan majorities, Governor Jay Nixon vetoed the tax cut reform calling it an ‘ill-conceived experiment.’ I would argue that the only ill-conceived experiment we have conducted in Missouri was electing a governor that loves taxes. He wants to keep the tax dollars rolling in so that he can continue to buy new airplanes and fund pensions for politicians. Governor, cutting taxes is not an experiment! This is the real world of working folks. It is common sense that tell us: taxes kill jobs. Taxes give power to politician. Taxes hurt Missouri families. And taxes cause families and businesses to leave Missouri to find jobs in Kansas, Tennessee, and Texas!

Nixon decided to kill pro-growth tax cuts because he, like most politicians, believes he knows how to spend our money better than we do. This “buying elections” with other people’s money has left our state and our nation in a dangerous fiscal and economic situation. We’ve got a clear message for Governor Nixon: BACK OFF!

“So that the record of history is absolutely crystal clear. That there is no alternative way, so far discovered, of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by a free enterprise system.”

–Milton Friedman

The choice is clear: do you want more government or more jobs?! When politicians spend our tax money on continuing special interest projects, there is less money for us to spend the way we want to spend it…like on our own families or small businesses! It is all about control….and “the golden rule”: he who has the gold, rules! If the politicians have more money, they are in control. If Missouri citizens keep their money, they are in control. It is a simple matter of an old-fashioned term called “trust.” Who do you trust? Politicians? Or yourself?

I understand job creation. Our family business has been creating jobs in Missouri for over 100 years. But with all the regulations and high taxes, it is getting tougher and tougher to compete. And anyone with a small business or family farm knows exactly what I’m saying! The answer is simple: government needs to back out of our lives, our schools, our farms, our businesses, and our churches so we can get back to work!

How do we get Missouri back on track? We need to override the governor’s job-killing veto. Enacting House Bill 253, the Missouri income tax cut, will be the first solid step in restoring Missouri’s economic standing among the states that have leapt ahead of us. More money for our citizens will make Missouri the job-creating state it once was. After all, for every extra dollar you have and spend, you are helping to create more real jobs. I encourage you to join me in contacting your legislators, and tell them to vote yes to override Governor Nixon’s veto of House Bill 253. Character before career!
John Brunner

Missouri Chamber deeply disappointed with Gov. Nixon’s veto of unemployment system reforms, feels the veto is completely political

On July 2, Gov. Nixon vetoed House Bill 611, legislation containing provisions that would keep Missouri in compliance with federal mandates and protect money that is critical to Missouri’s unemployment insurance system. The legislation also contains a provision that would protect the integrity of the program by better defining misconduct for which an employee was disqualified from unemployment benefits. This language, which protects the integrity of the fund was also contained in Senate Bill 28, legislation that Gov. Nixon also vetoed. Both bills were Missouri Chamber priorities.

“Both of these bills would have saved Missouri businesses countless dollars and rooted out fraud in the unemployment system, with one stroke of a pen he has raised taxes on Missouri businesses to the tune of almost $1billion” Daniel Mehan, president and CEO of the Missouri Chamber said. “Employers have cited cases where unemployment benefits are being paid to employees fired for doing drugs on the job and stealing from their employer among other infractions. There is no reason why this common sense legislation should have been vetoed. The examples the governor gives for his veto are absolutely ludicrous and make no sense. This is a purely political move and this veto has jeopardized $1 billion.”

The mandates addressed in HB 611 were required under the federal Trade Adjustment Extension Act of 2011. HB 611 would require employers to provide separation information more quickly. The Trade Adjustment Extension Act of 2011 prohibits relieving an employer from charges of benefit payments (known as non-charging) when the employer fails to respond timely or adequately to a written request for separation information. Another provision of HB 611, as mandated by the Trade Adjustment Extension Act of 2011, is designed to penalize claimants who fraudulently continue to accept unemployment benefits after returning to work.

“If we don’t come into compliance, more than $1 billion will be lost by Missouri employers and the state and Missouri employers will lose FUTA tax credits,” Mehan said. “The governor is gambling with employers’ money and it’s going to hurt Missouri businesses.”

The Department of Labor projections for the Unemployment Trust Fund show that $527 million of the borrowed funds are still outstanding and must be paid back. Missouri will continue to have a deficit balance until 2016, a debt that is compounded by abuses to the system.

“Liberal interpretation of the definition of misconduct will continue to allow cases like these to erode the system without this legislation,” Mehan, said. “This raises the costs on all employers who fund the system. We need to protect the system for the purpose it was intended.”

The measure would be a step in the right direction to help pay down the state’s $527 million debt on unemployment insurance by reducing “abuses to the system.”