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Some charities oppose plan to rein in tax credits
Some charities oppose Gov. Jay Nixon's plan to rein in the state's tax credit programs, fearing that their funding source could be crowded out by politically influential recipients.
Rep. Shane Schoeller, R-Willard, and three other House Republicans held a press conference Monday with organizations that benefit from benevolent tax credits to express opposition to the governor's latest proposal.
Floated just last week, it would cap business and job development tax credits at $150 million, cap subsidies for low-income housing at $75 million and cap the rehabilitation of historic homes and buildings at $75 million annually.
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Charities oppose Nixon's proposed tax credit caps
In March, Nixon's administration proposed reorganizing the state's roughly 60 tax credit programs into six general categories and capping certain tax credits at $314 million per year.
"These tax credits do leverage funds to raise many more times those dollars in local communities," said Cindi Boston, CEO of the Pregnancy Care Center in Springfield.
Republican House leaders have defended tax credits as good economic development tools and have denounced efforts to sharply curtail them.
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Tax credits among battles in Legislature's final week
Speaker of the House Ron Richard, R-Joplin, is opposed to Nixon's effort to rein in tax credits. He defends them as an important part of economic development.
Rep. John Diehl, R-Town and Country, favors a go-slow approach on overhauling tax credits. "I don't think there's anything we have to have if it means gutting the programs we have now," he said. "I don't see the House rushing to judgment on any of this."
The challenge is mostly one of time. As directed in the state constitution, the session ends at 6 p.m. Friday.
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Rethinking tax credits
In late March, the MGA and SLU released a study showing that, over the last 10 years, the historic tax credits have helped create or retain more than 43,000 jobs and have led to more than $669 million in new sales and income tax revenue for state and local governments.
Researchers for the study found that every situation where historic tax credits were used, the credits sparked more development nearby and, in the case of Ste. Genevieve and Hermann, helped increase tourism. There were no situations they found in which the tax credits didn’t work in that way.
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Debate continues on tax credit reform
Developers in Joplin say the Governor's push for tax credit reform would hurt a program that has been central to revitalizing downtown Joplin.
Kristen Blanchard, spokeswoman for Representative Ron Richard, R-Joplin, said Richard is "open to meeting with the governor and would support a comprehensive review of the program at some point, provided it was 'objective' and included a cost-benefit analysis of the tax credit programs."
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