Category Archives: Gov’t Oversight and Accountability

No More M.A.D. with Kansas

Missouri and Kansas have a long history of competition – and worse. In the 1860s, we fought in the Civil War. We used to compete in sports every year, until KU chickened out when Mizzou moved to the SEC. And, for the past decade, we’ve battled to lure jobs across the border by dangling so-called jobs tax credits.

In the past four years, Missouri and Kansas have collectively doled out $217 million in corporate subsidies to seduce Kansas City area businesses to shuffle jobs across state lines, but fail to add any new jobs to the region. In these years, Kansas has spent $141 million to entice the re-location of 3,433 jobs from Missouri, and Missouri has spent $76 million to lure 2,929 jobs from Kansas – for a net difference of 504 jobs at $430,000 per job. However large, these numbers still fail to take any “retention” tax credits into account to theoretically keep a company from moving jobs elsewhere.

Unfortunately, rather than create a long-term low tax climate for all entrepreneurs and families, these corporate subsidies only provide special benefits to the privileged few big enough to be aware of the benefits and savvy enough to work the system. Both states shuffle the cards around, hold celebratory gubernatorial press conferences, and pretend as if real economic growth is occurring.

In the era of a 24-hour news cycle, these perpetual press releases touting corporate subsidies create the appearance of success. These results prove that our economic development border war is not leading either state to prosperity. Instead of improving our economy, the border war paves a path of mutually assured destruction.

Both states give hard-earned taxpayer dollars to businesses to move just a few miles. Their employees probably never move. They don’t start shopping in new places. They don’t generate new economic activity for the region. The only change is the address from which they operate.

This is insane economic policy. And it illustrates the fundamental problem with our so-called jobs tax credits: they don’t actually create new jobs, especially when the subsidies are spent in competition with Kansas.

House Bill 1646, sponsored by Speaker Tim Jones (R-Eureka), directs the Governor and the Department of Economic Development to negotiate a corporate subsidy ceasefire with Kansas for the nine combined border counties in the Kansas City metro area. It tells Kansas that we’re willing to work for the greater benefit of the entire Kansas City region, but we’re not going to unilaterally disarm. If Kansas passes a similar law, we’ll call a truce.

This limited bill enjoys broad support in the legislature. As one who is skeptical of the entire corporate subsidy shell game, I’m hopeful that it’s the first of many steps to re-examine our economic development policy. Going forward, we should pursue an interstate compact with several other states to shift the focus away from specialized giveaways and back to lower taxes for everyone.

Ending the Medicaid Poverty Trap With Welfare Reform

As Pope Francis has explained, “Work is fundamental to the dignity of a person. Work…‘anoints’ us with dignity, fills us with dignity, makes us similar to God” and “gives one the ability to maintain oneself, one’s family, to contribute to the growth of one’s own nation.”

In 1996, President Clinton and a Republican Congress enacted welfare reform legislation requiring welfare recipients to work. The concept is simple. Americans – and Missourians – are not stingy when it comes to helping people who are willing to help themselves. We’re willing to help those who have fallen on hard times temporarily so that they may get back on their feet. But we aren’t willing to continue to distribute hard-earned taxpayer dollars to people who show no personal responsibility and would rather live off a government check. Welfare programs should be a safety net for the industrious, not a hammock for the indolent.

For the able-bodied, a life without work is a life lacking purpose. Welfare reform rejected the idea that certain people were destined for a lifetime of poverty and unable to help themselves. It insisted that they use their talents to live a productive life. And it worked. Employment and earnings for single mothers increased significantly. Welfare caseloads decreased. The Brookings Institute, a liberal think tank, concluded welfare reform “has been a triumph for the federal government and the states – and even more for single mothers.”

House Bill 1901, which I have co-sponsored, attempts to bring the principles of welfare reform to our state Medicaid program by requiring able-bodied Medicaid recipients to participate in the workforce to remain eligible for Medicaid. Under the current system, it is morally reprehensible but economically rational for a person at the lowest end of the income scale to refuse work in order to remain eligible for Medicaid. Consider a single mother who makes $3,000 a year. If she accepts a job that pays her an additional $5,000 per year, she loses health care coverage worth approximately $5,200. It is economically rational for her to refuse the new job because. After all, she’s essentially working for free. But by turning down this first job, she’s much less likely to get the next job which may lift her out of poverty. The current system is a welfare trap.

HB 1901 moves Missouri out of the welfare trap. It compels capable recipients to work, and it rewards such work by increasing eligibility for the working poor. By passing this bill, Missouri could lead the nation in bringing welfare reform to Medicaid.

On Monday, the House Committee on Government Oversight and Accountability heard three other bills designed to ensure welfare benefits are reserved for those who need it most and to improve health outcomes of recipients.

House Bill 1861, sponsored by Rep. Wanda Brown, is a direct response to an expose from Auditor Tom Schweich, who uncovered 366 cases of welfare recipients spending Missouri welfare benefits for several months in other states, including one such recipient, for five months, in the Virgin Islands. HB 1861 would bar benefits for any recipient who doesn’t use them in Missouri for 90 days – eliminating wasteful and fraudulent entitlement spending by recipients who are no longer Missourians.

House Bill 1864, also sponsored by Rep. Brown, requires the Department of Social Services to use data analytics software to cross-check the eligibility of welfare recipients to ensure that they are indeed eligible. The department estimates that it will save at least $4 million a year in Medicaid. As chairman of the committee, I plan to combine these bills and require an eligibility cross-check for recipients who have left the state, likely increasing savings.

House Bill 1879, which I sponsored, encourages healthier lifestyles for food stamp recipients by starting a pilot project to provide bonuses for purchases of fresh fruits and vegetables at Missouri  farmers’ markets. The goal of this legislation is to help fight the public health crisis of obesity. We know that eating fresh fruits and vegetables leads to better health, but they aren’t always available or affordable for food stamp recipients. This bill gives an added incentive and ability for recipients to eat healthier foods. Plus, the bill benefits local farmers and small business owners by growing the market of people likely to buy their homegrown goods.

The committee will combine these bills and a few others to create a welfare reform omnibus bill, carried by Rep. Brown, to save taxpayer money and reduce waste, fraud, and abuse.

Stamping Out Welfare Fraud

Fox 2 from St. Louis reports on Auditor Schweich’s findings of welfare fraud through the use of welfare cards in different states – and, in at least one case, the Virgin Islands. Worth noting – Rep. Wanda Brown filed HB 1861 last week to put an end to this practice and I was glad to be the first co-sponsor.

School-Based Health Clinics Work

On Monday, the House Committee on Government Oversight and Accountability passed HB 1052, a bill to encourage the construction of school-based health care clinics in high-poverty school districts. Many other states, most notably Texas, have robust school-based clinic programs. The following is a memo from my Legislative Assistant Emily Walker summarizing research on these clinics. Conclusions: they work to save money, reduce unnecessary ER visits, and improve the health and education outcomes of students in schools where these clinics exist. 

To:       Representative Barnes

From:   Emily Walker

Re:       School Based Health Clinics

Date:   February 6, 2014

 

Question:        What are the value of School Based Health Clinics based on academic studies and real world data?

 

            School Based Health Centers (SBHCs) have developed in the past three decades as a solution to health care access problems in younger populations.  These in-school clinics help to “overcome utilization barriers in a way not previously documented in other clinical settings, even when serving populations that suffer from significant health disparities.”[1] Based on census data collected by the School-Based Health Alliance for 2010-2011, there were 1381 school based clinics that provided primary care and responded to the surveys.[2] SBHCs are found in a variety of communities: 54.2% in urban areas, 27.8% rural areas, 18.0% suburban areas.[3]  Of the responding clinics, 94.4% are located within school buildings.[4] The numbers of these clinics are growing and Missouri already has four located within our state.[5]

            There is no set funding or structured mechanisms for SBHCs.  Financing may come from a variety of sources and control comes from multiple levels (private sector, local government, state government, etc.)  Other states have successfully implemented these clinics on a state level.  Texas recently passed an expansion measure in 2009 to further support SBHCs.[6] HB 281 was a bipartisan bill passed unopposed in the House Public Education and Senate Education committees and signed into law by Governor Perry.[7]  This expansion of the program included stabilized and increased grant funding for the programs.[8]  According to the Census data collected by the School-Based Health Alliance, Texas had 87 school-based health clinics at the time of the survey.[9]

            There are many benefits to the school-based health clinic system.  These clinics have consistently shown decreases in emergency department visits, increases in primary care access, increases in immunizations, and better quality of health care for children who traditionally lack health care resources.  SBHCs knock down many of the barriers that children from high-risk families often battle, including: lack of private health insurance, transportation to appointments, parental absence from work, lack of awareness, and other stressors that keep children away from health professionals.[10] Not only do these programs give children access to health care, the ultimate goal of the clinics serves the ultimate goal of education programs.  As Adams and Johnson explain, “the program is aimed at improving school attendance and classroom performance and the longer-term prospects for these children as they mature”[11] 

            Numerous studies have found the cost saving measures that school-based clinics provide for public insurance programs. In Adams and Johnson’s article, An Elementary School-Based Health Clinic: Can it Reduce Medicaid Costs?, the authors answered the title question in the affirmative.[12]  This study compared children served by a school-based clinic to demographically similar children who did not have access to the same kind of clinic.[13]  There were no significant differences between the groups before the clinic opened, but two years after its opening, the children with access to the clinic had significantly lower instances of inpatient visits, non emergency department transportation, drug, and emergency department Medicaid expenses.[14]  These lower instances of high cost health care items meant that the school-based clinic helped to curb costly health care mechanisms for the children who had access to the SBHC.

            Another study also examined the affect of school-based clinics on the frequency of emergency department visits.  In Young, D’angelo, and Davis’ 2001 article Impact of a School-Based Health Center on Emergency Department Use by Elementary School Students, the authors wrote that emergency room visits are often non-urgent and have the negative effects of increasing medical costs and fragmenting health care.[15]  In their study, the authors examined elementary aged children (5-12) from an inner city neighborhood.[16]  The clinic served a school that had a student population of 95% of the population on free/reduced lunch and 60% African American/40% White.[17]  This study used a retrospective audit of emergency department records that compared the year before implementation of a school-based clinic to the year after its inception.[18] There was a significant drop in emergency room visits after the school-based clinic was introduced to the school.[19]  The results of this study show that SBHCs help to decrease non-urgent emergency department visits, and therefore the higher costs of these visits.

            Key, Washington, and Hulsey provided their findings of lesser emergency department visits by adolescents enrolled in SBHCs into their 2002 article, Reduced Emergency Department Utilization Associated with School-Based Clinic Enrollment.  This was another retrospective cohort study that examined emergency department utilization rates before and after adolescents enrolled in a SBHC.[20]  The subject school was an urban, public high school that’s student population was made up of 80% free/reduced lunch recipients and 99% African American.[21] The study showed a decrease in the emergency department visit rate for both groups from the base year, but this decrease was only statistically significant for the students who chose to enroll in the SBHC (enrollees had a 41% decrease of emergency room visits after enrolling in the clinic).[22]  The authors noted that because the study compared a population with prior emergency room use and then recorded the changes following the enrollment in a SBHC, the SBHC should be attributed as the cause of the decrease.[23]

            Beyond the scope of saving money on decreased emergency room visits, SBHCs serve other important interests as well.  One major benefit to note is the ability of SBHCs to help with vaccination rates in adolescents. In the article Addressing Adolescent Immunization Disparities: A Retrospective Analysis of School-Based Health Center Immunization Delivery, the authors performed a study to determine if SBHCs can improve rates of immunizations among at risk children and adolescent populations.[24] The study was a retrospective cohort analysis of children and adolescents who were split into groups that received health care from either a Denver SBHC or Community Health Center (CHC).[25]  For most types of vaccinations, children and adolescents were more likely to be up-to-date on their immunizations if they received health care from SBHCs.[26]  Along with this, for vaccines that require multiple doses over a set period of time, SBHCs were more likely to guarantee children received all doses.[27]  The authors noted a variety of reasons for why SHBCs are better for vaccinations, including: easier access to care, reminders to come back for care are easier, the tracking system is easier within the school system, many SBHCs see patients without any payment requirements, parents do not have to leave work, and students do not have to leave campus for the care.[28]

            Finally, a more recent study addresses all of the issues discussed above and the overall strong benefits of SBHCs.  In the article School-Based Health Centers: Improving Access and Quality to Care for Low Income Adolescents, the authors wanted to examine all of the advantages of SBHCs.[29] This was a retrospective cohort study that tracked the use of health care and markers of quality of care for adolescents enrolled in SBHCs compared to adolescents who used other community care entities.[30]  The SBHCs helped to increase uninsured adolescents access to care for primary health care.[31]  This increase in access to care through SBHCs led adolescents to report a higher likelihood to have three or more primary care visits, less emergency department visits, more health maintenance visits, and a higher likelihood to receive a flu vaccine, a tetanus booster, and a Hepatitis B vaccine.[32]  The authors of this study strongly established that SBHCs provide underserved adolescents and children with better access to care and an overall higher quality of health care than traditional community health systems do.

            There are multiple studies available to show the benefits of SBHCs to serve populations of children and adolescents that traditionally have not received quality health care.  These clinics have statistically shown they can reduce Medicaid expenditures through better preventive care measures, they increase immunization rates, and overall, they provide higher quality of care for a population that is often underserved.



[1] Steven Federico, et. al., Addressing Adolescent Immunization Disparities: A Retrospective Analysis of School-Based Health Center Immunization Delivery, 100:9 American Journal of Public Health,1630-1634 (2010).

[2] sbh4all.org, 2010-2011: Census Report of School-Based Health Centers, School Based Health Alliance, 2012, http://www.sbh4all.org/atf/cf/%7BB241D183-DA6F-443F-9588-3230D027D8DB%7D/2010-11%20Census%20Report%20Final.pdf (last visited February 6, 2014).

[3] Id.

[4] Id.

[5] Id.

[6] tasbhc.org, Legislative Efforts, Texas Association of School-Based Health Centers, 2009, http://www.tasbhc.org/legislative-efforts/ (last visited February 6, 2014).

[7] Id.

[8] Id.

[9] 2010-2011: Census Report of School-Based Health Centers.

[10] Thomas Young, et. al., Impact of a School-Based Health Center on Emergency Department Use by Elementary School Students, 71:5 Journal of School Health, 196 (2001).

[11] E. Kathleen Adams and Veda Johnson, An Elementary School-Based Health Clinic: Can it Reduce Medicaid Costs?, 105 Pediatrics, 780-788 (2000).

[12] Id.

[13] Id.

[14] Id.

[15] Young, D’angelo, and Davis.

[16] Id.

[17] Id.

[18] Id.

[19] Id.

[20] Janice Key M.D., E. Camille Washington, M.D., Thomas C. Hulsey M.S.P.H., Sc. D., Reduced Emergency Department Utilization Associated with School-Based Clinic Enrollment, 30:4 Journal of Adolescent Health, 273-278 (2002).

[21] Id.

[22] Id.

[23] Id.

[24] Id.

[25] Id.

[26] Id.

[27] Id.

[28] Id.

[29] Mandy A. Allison, MD, MSPH, et al. School-Based Health Centers—Improving Access and Quality of Care for Law-Income Adolescents, 120:4 Pediatrics, 887-894 (2007).

[30] Id.

[31] Id.

[32] Id.

House Committee to Investigate Execution Protocol of Department of Corrections

The House Committee on Government Oversight and Accountability will hold a hearing on the state’s execution protocol on Tuesday, January 22 at 2:00 p.m.

Regardless of what anyone thinks of the death penalty, everyone should agree that it must be carried out according to the requirements of the Constitution and laws of our state. 

The hearing will focus on two areas of the Department of Corrections’ execution process. 

First, the committee will seek the standards, if any, that the Department has for determining whether the condemned has had all of their constitutional appeals determined by the appropriate courts.

This inquiry is the result of a recent dissenting opinion filed by Judge Kermit Bye in the wake of Missouri’s last execution. In the late December 2013 opinion, Judge Bye wrote:

At approximately 10:52 p.m. on December 11, 2013, Missouri executed Allen Nicklasson before this court had completed its review of Nicklasson’s request for a stay of his execution, a request he brought in a pending action challenging the constitutionality of Missouri’s execution protocol. That bears repeating. Missouri put Nicklasson to death before the federal courts had a final say on whether doing so violated the federal constitution.

Second, the committee will seek information on the Department’s process for determining the new drug it would use for executions, including allegations that the drug was obtained by an unlicensed pharmacy. 

Boeing RFP Response from Missouri

The Department of Economic Development responded late this afternoon with a box of documents relating to the state of Missouri’s response to Boeing’s request for RFP for production of the 777x.

I’ve attached the most relevant documents to this post. 

It’s interesting that DED Director Mike Downing leads off DED’s RFP response with a paragraph highlighting Missouri’s tax climate. I agree. Taxes matter most. So let’s enact broad-based tax relief to encourage job growth throughout the economy – not just to the special and privileged few.

It’s also worth noting that these are opening offers. A final deal could have looked a little bit different. The cost to taxpayers could have been higher. For example, Gov. Nixon had greater authority to negotiate on BUILD benefits. At the same time, the cost could have ended up being lower as well – for instance, if Boeing did not create as many jobs as contemplated in the offers below.    

Credit where it’s due: I’ve frequently been a critic of DED and our so-called jobs tax credits. However, DED has always been very cooperative and timely with document requests. They were again this time. In addition, regardless of whether you think the Boeing subsidy legislation was good public policy, the documents provided show that DED exhibited great competence in putting this package together in a very short time period for Boeing.

  1. Gov Nixon Letter
  2. Scenerio 1 – Full Project
  3. Scenerio 2a – Wing Project
  4. Scenerio 2b – Fuselage Project
  5. Power Point
  6. St. Louis County Summary
  7. DED Program Summary Documents

AIM Casts Doubt on Every Jobs Tax Credit in Missouri

The Kansas City Business Journal reports that the Associated Industries of Missouri is questioning whether the proposal for a tax credit ceasefire in the Kansas City metro area is constitutional.

AIM’s Ray McCarty claims Sen. Ryan Silvey’s proposal to create a neutral zone in Missouri and Kansas wouldbe discriminatoryand could violate Missouri’s constitutional restriction prohibiting differential treatment of taxpayers, the dormant Commerce Clause of the federal constitution, and the Equal Protection Clause of the Fourteenth Amendment.

I think McCarty is wrong – and will explain why. But the really interesting thing is – if he’s right, then most, if not all, of Missouri’s so-called jobs tax credit programs are unconstitutional.

Dormant Commerce Clause

McCarty cites a memo by Jeffrey Dardick, a partner at Pricewaterhouse Coopers, to explain the dormant Commerce Clause argument. In short, the dormant Commerce Clause enforces a 50 state free-trade zone throughout the United States. No state may enact a law which discriminates against the free flow of commerce through its borders from another state.

Dardick cites Cuno v. DaimlerChrysler, 386 F.3d 738 (6th Circ. 2004) to argue that Sen. Silvey’s proposal is unconstitutional under the dormant Commerce Clause.  The Cuno Court examined an Ohio statute which was remarkably similar to Missouri’s BUILD statute. [1]

The Cuno Court explains the legal test:

In general, a challenged credit or exemption will fail Commerce Clause scrutiny if it discriminates on its face or if, on the basis of a sensitive, case-by-case analysis of purposes and effects, the provision will in its practical operation work discrimination against interstate commerce by providing a direct commercial advantage to local business. Discrimination simply means differential treatment of in-state and out-of-state economic interests that benefits the former and burdens the latter. A state tax provision that discriminates against interstate commerce is invalid unless it advances a legitimate local purpose that cannot be adequately served by reasonable nondiscriminatory alternatives.

I believe Sen. Silvey’s cease-fire legislation passes this test for three reasons.

  • First, the alleged discrimination against Kansas businesses is not triggered solely by an act of the state of Missouri. Instead, the trigger is both states enacting reciprocal legislation. Thus, the alleged discrimination against Kansas businesses would only occur with the consent of the state of Kansas. As the
    legislature learned and discussed last year with the use tax fiasco, states are free under the dormant Commerce Clause to discriminate against their own citizens.
  • Second, the reciprocal arrangement ensures that Missouri businesses have the same restrictions in Kansas that the Kansas businesses have in Missouri. This puts the businesses on the same footing and there is no discrimination.
  • Third, Sen. Silvey’s legislation advances a legitimate local purpose (stopping the use of tax credits which do not actually grow the region’s economy) that cannot adequately be served by reasonable nondiscriminatory alternatives.

The Cuno Court examined Ohio’s version of BUILD – and held that it violated the dormant Commerce Clause. To my knowledge, no taxpayer has ever challenged Missouri’s version. The Sixth Circuit case, while persuasive, is not binding precedent. I am not aware of any Eighth Circuit opinion on the issue. And, the Eighth Circuit could very well come to a different conclusion because these cases are in the gray area of dormant Commerce Clause case law.

Equal Protection

AIM also lists the equal protection clause of the Fourteenth Amendment as potential grounds for a constitutional challenge. This claim is not serious. The equal protection clause prohibits states from denying any person equal protection of the laws by treating them differently than similarly situated persons.

Courts examine equal protection challenges under three standards. Suspect classifications, such as race, national origin, religion, or classifications which burden fundamental constitutional rights, are examined under strict scrutiny. A middle level of scrutiny is applied to classifications based on gender. Everything else receives rational basis review – the minimum level of scrutiny. Under rational basis review, a law is upheld if it is rationally related to a legitimate governmental reason offered to justify the differential treatment. Courts rarely strike laws as unconstitutional under rational basis review. As explained by the Missouri supreme court, “[a] classification will be sustained if any state of facts reasonably can be conceived to justify it.” Schnorbus v. Director of Revenue, 790 S.W.2d 241 (Mo. 1990).

Sen. Silvey’s cease-fire legislation does not affect a suspect class, fundamental right, or gender, and would be reviewed under the rational basis test – which it would easily survive. The cease-fire is rationally-related to the legitimate government end of want to protect resources that would otherwise be used for roads, schools, corrections, and the other typical government functions. In addition, businesses considering whether to move a few miles and create no net new jobs in the Missouri-Kansas border region are not similarly-situated to businesses from elsewhere.

Article X, Section 3 of the
Missouri Constitution

AIM also cites Article X, Section 3 of the Missouri Constitution, which requires that taxes “shall be uniform upon the same class or subclass of subjects within the territorial limits of the authority levying the tax.” In Schnorbus v. Director of Revenue, 790 S.W.2d 241 (Mo. 1990), the Missouri Supreme Court explained that, under Article X, Section 3,  “The power of the state to classify for the purpose of taxation is broad. For income tax purposes, the taxpayer may be classified upon the reasonable basis of legal organization or the amount or source of income.” The question in this case is whether legislation can classify taxpayers on reasonable bases of location when the programs in question create no net new jobs when used in certain geographical areas.

I am confident the Missouri Supreme Court would uphold this reasonable classification. But, as with the dormant Commerce Clause argument, if AIM is right, then it also puts in doubt industry-targeted tax credits such as the Boeing legislation passed in special session and the Ford bill passed in 2010. Considering the group making this constitutional argument, the irony is rich.

While I have serious doubt about whether any of these so-called jobs tax credits actually work, you can’t just throw stuff at the wall and hope something sticks. Accordingly, the legislature should ignore AIM’s claims on Sen. Silvey’s proposed cease-fire legislation.


[1] The statute, “grant[ed] a taxpayer a non-refundable credit … if the taxpayer ‘purchases new manufacturing machinery and equipment during the qualifying period, provided that the new manufacturing machinery and equipment are installed in [Ohio].”

Requesting Tax Subsidy Transparency for Taxpayers from Gov. Nixon

Now that the bidding for Boeing is complete, I have requested that the Nixon administration release the offer it made to Boeing to the public. Here’s the text of the letter: 

Director Mike Downing

Missouri Department of Economic Development

301 W. High Street

P.O. Box 1157

Jefferson City, MO 65102

Dear Director Downing:

On Friday, the Boeing machinists’ union in Seattle ratified a contract which guarantees the 777x jet will be built in the Seattle-area and not one of the 22 other areas which offered incentives for Boeing to move production.  This effectively ends Missouri’s courting of Boeing through the subsidy package authorized in the recent special session.

With the conclusion of the Boeing bidding process, I write today to request all documents related to the subsidy package offered to Boeing by the state of Missouri either through the Department of Economic Development (or directly through the governor’s office). I understood the need for secrecy during the pendency of the bidding process. Now that the process is over, however, I believe Missouri taxpayers deserve to know the full details of the offer made to Boeing on their behalf.

Given the speed with which Gov. Nixon’s offer to Boeing was compiled, I’m confident you will proceed with the same sense of urgency to ensure public accountability and openness on the backend of the bidding process. I believe it reasonable to assume that the documents evincing the Department’s subsidy offer to Boeing could be provided to my office and, by extension, Missouri taxpayers, by Friday, January 10. If there is a problem with this timeline, please let me know. I look forward to hearing your response.

Sincerely,

Rep. Jay Barnes

cc. Jason Zamkus, Office of Gov. Jay Nixon

On Boeing with Warren and John

Had a good visit yesterday with Warren and John in the KWOS studios explaining why I’m a no vote on the $2.4 billion Boeing subsidy proposal.

An Amendment to Make Gov. Nixon Stick with the Plan He’s Sold

After a day spent spinning my wheels analyzing Gov. Nixon’s Boeing proposal, I went to bed thinking that I couldn’t stop this plane so I might as well stop trying. Then, I woke up at 3 a.m. (partially as a result of a strained neck that I’ve been dealing with the past few days) and I couldn’t fall back asleep. I just kept thinking that I would always regret it if I said or did nothing more.

Conceding that the bill’s passage is all but a foregone conclusion and that it might already be too late, I present the following three charts to attempt to persuade my colleagues in the General Assembly to amend the bill to further ensure that Gov. Nixon sticks with the plan he’s been selling, and does not pull a bait-and-switch after he’s been handed enhanced negotiating authority. (And to explain to constituents why I’m voting no.)

In particular, I believe the legislature should limit Gov. Nixon to the $1.7 billion offer he has publicly described and affirmatively remove his ability to offer $700 million more in incentives to Boeing through an enhanced subsidy under the BUILD program. The reason this amendment is necessary is because, while supporters argue the state will recoup the subsidies under the $1.7 billion plan, the following charts show that it will be very difficult for the state to recoup the subsidies under a $2.4 billion plan. (This also illustrates just how bizarre this situation is, it is not known whether Boeing even desires the additional 5 percent that would come from locating in a “distressed community” because those details have not been revealed and the legislature hasn’t even had 24 hours to review Gov. Nixon’s numbers before debating the bill.)

See Boeing Subsidy Chart and Explanation for a detailed explanation.