By House Minority Caucus Chair Michael Butler
No matter the occasion, political leaders in Missouri government talk endlessly about our need to create jobs in this state. Most recently we heard this when the Governor and the mayors of St. Louis and Kansas City submitted bids for Amazon’s 2nd headquarters, which promises to bring 50,000 jobs to Missouri. Typically, ‘job creation’ is used as a justification for cutting taxes, gutting regulations, or even passing laws legalizing discrimination, like the majority party did with Senate Bill 43 during last year’s legislative session. Many of my colleagues said this would create a more business friendly climate in Missouri. However, aside from SB 43 being a violation of the Fair Housing Act, its effect on the business environment remains to be seen. At the same time the Governor and the majority party in the legislature were “creating a more business friendly climate” in the Show Me State, they cut the budget of a proven job-generator, The Missouri Technology Corporation.
The Missouri Technology Corporation (MTC) is a public-private partnership created by the Legislature to promote entrepreneurship and foster the growth of new and emerging high-tech companies, and has been investing in startups all over the state since 2010. In the most recent budget passed by the legislature, funding for (MTC) was slashed by about $17 million dollars. Almost immediately following the legislative session, Governor Greitens and Missouri Republicans brought us back to Jefferson City this spring to secure special utility rates for a company to bring 500 steel mill jobs to the bootheel. The Missouri Technology Corporation on the other hand, creates more jobs each year and makes a profit, through smart investments in innovative companies involved in biomedical science, applied engineering, animal and plant science, as well as defense and homeland security.
MTC often provides early stage funding that is a catalyst for attracting additional private investments, and they receive dozens of applications from all over the state from companies requesting financing. In the last funding cycle of 2016, MTC received 38 applications from companies requesting $14 million dollars in co-investment awards. Since the MTC began awarding these funds in 2010, over $400 million dollars of additional private capital has come into Missouri. The most recent Census data from 2013 puts Missouri at number one in the nation for new business formations, and in 2016 Forbes recognized Missouri as a top ten states for startup funding. Thanks to the Missouri Technology Corporation Missouri has been bucking the entrepreneurial slump. According to the analytical website FiveThirtyEight.com, four Missouri metro areas–St. Louis, Springfield, St. Joseph and Kansas City–were in the top 20 cities with the fastest growing rate of new startups in 2014. Missouri was the only state with four metro areas in the top 20.
Slashing the funding of this vital public-private investment fund threatens the significant progress we’ve made in creating high paying jobs, especially in the tech industry. Furthermore, it provides an opening for other states to attract startups we no longer have the capital to support. The Indiana legislature recently committed to investing a billion dollars into startups over the next 10 years. It ought to be asked, if the Governor and the majority party are really prioritizing the creation and growth of small businesses, and high paying jobs? If they were, we wouldn’t see such drastic cuts in a job creating engine like the Missouri Technology Corporation. I personally would like to see these funds restored in our next budget, and I’m certain the business and startup community would agree. I also don’t want to see the energy and investment that has gone to our economic beacon in Cortex to go elsewhere. Our region and our state’s future depend on it.