Legislation that would end tax incentives for businesses that cross state lines within the Kansas City Metro area was heard before the House Small Business Committee and the Senate Jobs, Economic Development and Local Government Committee this week, sparking coordination between lawmakers seeking to end the ‘Border War’ with neighboring Kansas.
House Speaker Tim Jones, R-Eureka, who sponsors House Bill 1646, testified that businesses in the Kansas City area are collecting generous incentives from both states by “shuffling” existing jobs across state lines without creating any new, net job growth.
Bill Hall presented a study by the Hall Family Foundation that found Kansas and Missouri have waived $217 million of taxes through two programs to shuffle businesses in recent years. Bill Hall, the foundation’s president, testified in favor of both the Senate and House versions of the bill.
“We are waging a wasteful economic development border war – and both states are losing,” Hall testified. “We do not oppose the use of incentives such as Missouri Works when they create new economic activity. We do oppose the wasteful use of incentives when they shuffle existing jobs and produce little or no economic development.”
Kansas counties Douglas, Johnson, Miami, and Wyandotte and Missouri counties Jackson, Clay, Platte, and Cass are included in the bill. Any business moving from one of these counties across state lines into another would be ineligible for incentives. The legislation in both the House and Senate is contingent on Kansas enacting an identical law.
“By working with our counterparts in Kansas rather than against them, it’s my hope we could end this boarder war,” Jones said.
The bill also does not affect expanding businesses, but is specifically targeted to businesses that are relocating between the two states.
The Missouri Chamber is supportive of this legislation and Tracy King, vice president of governmental affairs, testified on behalf of the bill.
The House Small Business Committee has scheduled an executive session to vote Jones’ bill out next week to move it along for further discussion.
For more information about tax issues, please contact Tracy King at email@example.com or by phone at 573-634-3511.