Kansas Senate backs ‘innovative’ economic incentive bill for megaprojects – The McPherson Sentinel

Noah Taborda Kansas Reflector

TOPEKA — Kansas senators on Thursday approved a financial incentive package to entice manufacturers to pursue so-called megaproject initiatives in the state, despite some concerns about the message it sends to existing businesses.

The bill is a response to a request from the Kelly administration to pass a measure that would sweeten the state’s bid for a public company that is expected to invest $4 billion in a production plant. Kansas is currently one of two finalists in the megaproject that could generate nearly 8,000 jobs and $2.5 billion in economic activity each year. The special incentive program would target companies planning to invest at least $1 billion in Kansas over a five-year period. . Additionally, an amendment added to the bill by Sen. Renee Erickson, R-Wichita, in committee would reduce the state’s 4% corporate income tax rate from 0.5%, or about $50 million. of dollars per year, each year project funds are sent to these companies . “Kansas hasn’t been competitive in attracting business,” Erickson told the Senate. “We also need to level the playing field so that we can compete with neighboring states that have lower corporate tax rates than ours and lower operating costs. This bill does both. The Senate approved the bill bipartisanly 32 to 7, with all seven negative votes coming from Republican lawmakers. A House committee is set to consider the measure for several days next week. The incentive package would also include up to 50% state property tax abatement for these businesses, a tax credit of up to 15% of capital investments made in a year and refunds up to 10% of total salary expenses. A safeguard amendment adding an expiration date of March 31, 2023, so lawmakers can review and renew the program next session and an amendment requiring local approval and disqualifying megaproject companies from other government incentives. ‘state the bill more attractive to some lawmakers. Sen. Jeff Pittman, D-Leavenworth, worried Sunset wouldn’t allow enough flexibility for the program, but called the incentive program innovative and was optimistic about the doors it could open for Kansas. “This will create jobs for our working families,” Pitt- the man said. “It’s going to allow us to be competitive, to advance our state, and to advance manufacturing and other opportunities where we need to innovate to stay competitive not just in the United States but in the global marketplace.” Caryn Tyson, whose motion to recommend the bill unfavorably to the Senate failed in committee, agreed with a constituent who told him the measure would be better titled ‘Cruy Capitalism Kicks Business existing in Kansas”. “This bill allows one person in the state of Kansas, the Secretary of Commerce, to decide the $1 billion to $1.5 billion incentives and there is no cap,” Republican Parker said. “It’s not just limited to Kansas residents. It’s disappointing that we’re passing this legislation and disappointing today that the state of Kansas has to live with this legislation.” mandated the entire House and Senate to approve any deals struck with megaproject companies and launched a 14-member oversight committee that would assess economic development projects. Mike Thompson, R-Shawnee, said a bill of this financial magnitude could have all sorts of unintended consequences. “I spoke with a small business owner in my district today,” Thompson said. “His concern was that if a large entity like this came along, and they were already having trouble finding employees, this large entity might drive employees away from them and exacerbate the problem.” Rep. Sean Tarwater, a Republican from Stilwell and chairman of the House Commerce, Labor and Economic Development Committee, said he has scheduled hearings on Tuesday, Wednesday and Thursday to further the APEX bill. He said the megaproject’s labor demand would be an important part of the conversation. “Do we need jobs in Kansas, or do we need workers in Kansas?” he said. “I think we’re going to be faced with those kinds of decisions here quite quickly.”