Friday, August 23, 2013

Jason Kander to Gov. Rick Perry: Don't mess with Missouri

Posted By on Fri, Aug 23, 2013 at 10:02 AM

Kander_official.jpg

Texas Governor Rick Perry is on his way to Missouri in a cynical effort to pick off companies from the Show-Me State.

The erstwhile presidential candidate is presumably looking to boost his 2016 credentials by luring companies to Texas so he can tell voters he "created jobs" when he, in fact, merely moved them from one place to another. Before his plane hits the ground somewhere in Missouri, an ad campaign supporting his visit is hitting the airwaves and telling Missouri companies to consider moving to Texas.

Perry's advances roused some annoyance from Missouri Secretary of State Jason Kander, who fired off a letter yesterday to Perry's office telling him that his journey to Missouri is a silly endeavor.

"Instead of launching a wholesale public relations effort meant to depress Missouri's business climate in hopes of luring jobs to Texas, I suggest you spend your time asking Texas business owners if there's anything you can do to help their companies move forward," Kander wrote. "If a company moves to Texas as a result of your sales pitch, there's a good chance it will leave for a better deal in some other state in the future. But if a company starts in Texas, it's more likely to stay there."

Businesses don't move to Texas because they like Perry or find his "sales pitch" enticing. It's all about the money.

Which is why Kander has a good reason to worry about Perry's trip to Missouri. While Missouri and Kansas have swapped companies for years with nearly identical tax incentive programs, Texas has a big purse that neither state around here can claim.

The Texas Enterprise Fund is a huge bank account for people like Perry to throw straight cash at companies in order to convince them to move to Texas. Missouri and Kansas tax incentive programs for the most part offer tax rebates, abatements or tax revenue redirection over time, while Texas can cut a big check for a company right away.

That's what happened in 2009 when Medtronic was looking to place a diabetes center in Lenexa, which could have drummed up about 1,400 jobs for the Kansas suburb. But the company officials traveled to Texas to meet with Perry before making a decision about Lenexa. Perry asked what it would take to get them to pick Texas over Kansas. Apparently $6 million from the Texas Enterprise Fund, along with other incentives, closed the deal for Texas. Kansas couldn't come close to matching that cash proposition.

Of course, Texas isn't making overt overtures for Kansas businesses these days. Kansas did last year what Texas has done for some time, which is eliminate corporate income tax for businesses structured as subchapter-S corporations or limited liability corporations.

Perry's trip to Missouri comes at the same time that Missouri Gov. Jay Nixon has been traveling all over the state trying to fend off a Republican effort to override his veto of an income-tax-cut bill that passed the Missouri General Assembly.

The GOP appears to be a few votes short of a veto override, but the thinking is that Perry's ad campaign in Missouri may scare fence-sitting lawmakers into switching their votes in order for Missouri to come closer to meeting Texas' tax structure.

For Kander's part, he's wishing that Perry's visit could, instead of luring businesses, convince Missouri lawmakers to accept extra Medicare funding from the feds like Perry's looking to do for Texas.

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