Boeing plan moves through Senate committee, Labor taking leading role
JEFFERSON CITY, Mo. — A tax credit incentive plan which could be worth more than $1 billion for Boeing Co. over 20 years passed out of the Senate Jobs, Economic Development and Local Government committee today by a vote of 8-2, clearing the way for floor debate in the Senate, where most observers say the deal has the best chance of crumbling.
The plan, which Missouri is submitting with more than a dozen other states, is designed to attract Boeing to commit to building its new 777X commercial airliner in
Missouri. Gov. Jay Nixon called a special session of the legislature to consider a package, which must be submitted to Boeing by December 10. The plan would offer $150 million in tax breaks to Boeing, if they choose Missouri as the site of the new project.
Senate testimony was largely in favor of the deal, with representatives from St. Louis area businesses and labor organizations pushing for the deal, which they say will reinvigorate a waning manufacturing market and strengthen ties with Boeing, who already manufacture the F-18 military fighter jet in the state.
Missouri’s position may be stronger today when labor leaders announced that they would work 24-hour days in building the new manufacturing facility, which could carve more than 2 years off the time of building.
“We’re prepared to work three eight-hour shifts, Monday through Friday, to get this done,” Jeff Aboussie, Executive Secretary-Treasurer of the St. Louis Building and Construction Trades Council says. “So with 8 hour shifts, nobody is working over time, and working 24-hour days we can build this in less than 3 years. We believe that puts us in a very strong position, being able to tell Boeing that we can have this factory open for business that fast, it’s a very good thing for us.”
The new work hours do not need to be voted on by the rank-and-file union members, Aboussie said. Laborers and Carpenter unions have also agreed to the deal, which was announced by Nixon during a conference call with reporters earlier today.
Detractors of the plan, like the two “no” votes in the Senate, Sen. John Lamping R-Clayton and Sen. Will Kraus, R-Kansas City, said they would only vote for the plan if it came with cuts to other tax credit programs, effectively making it revenue neutral.
“If we could protect Missourians by reallocating tax credit funds for this, I could imagine myself supporting it,” Lamping says. “But as it is, this is simply an increase that leaves our citizens open to a loss on investment.”
Local area leaders, like Mayor Francis Slay and President of the Greater St. Louis Labor Council AFLO-CIO, Bob Soutier, said that Boeing was a good corporate partner.
“This has to do with a company we all know,” Slay told the committee. “This is not some fly-by-night company we don’t know.”
Soutier said the chance to attract Boeing was a “once in a generation opportunity,” and said it had the potential to “revitalize” a manufacturing industry struggling over the last decade.
After the plan moved to the Senate for debate, the House Economic Development Committee met as well, hoping to hear the same testimony as the Senate and be prepared to take action on the legislation once the upper chamber takes action on the bill.
“It’s a broader debate now, certainly, but as chair of the economic development committee, I have a responsibility to move it forward,” Sen. Eric Schmitt, R-Glendale, says. “I completely understand the concerns of those who voted against it, but we have this very unique chance and a very narrow call from the governor in terms of what action we can take. What we do here is not to say we won’t explore broad based tax relief or tax credit reform, which are things I’ve supported during the regular session.”
Boeing has an open Request for Proposal (RFP) with more than a dozen states, and by company directive, they are not lobbying the legislation.
The Senate is expected to take the bill up for debate tomorrow when they gavel in at 9.a.m.