Governor Blunt Vetoes Economic Development Bill

For those of you that have not already heard, please be advised Governor Blunt vetoed HB 327 on Friday afternoon, July 6, 2007.

Reasons for the veto as listed in the Governor’s veto letter were:

1. The definition of “employee” was changed in the Quality Jobs Act to create an absurd result had the new definition become law;
2. The Governor objected to the Small Business and Entrepreneurial Growth Act because incentives would be provided for jobs with no health insurance requirement and that paid less than county average wage;
3. The nexus provisions allowing distribution centers to be located in the state by affiliated companies outside the state without creating nexus was deemed “...bad public policy. The resulting effect could put businesses already operating in Missouri at a competitive disadvantage”, according to the Governor’s veto letter;
4. The regional railroad authority would have given eminent domain and taxing authority to unelected officials;
5. The fuel tax exemption for trans-oceanic flights would reduce money that supports regional airports, although such flights do not presently exist; and,
6. The local sales tax exemption for manufacturing inputs would conflict with SB 30. The letter says local government officials had expressed concern about the conflict between the two provisions because the manufacturing inputs would have been exempted from local sales taxes under HB 327 but would not have been exempted under SB 30.

The Governor said in a press release he would consider a special session if legislators were willing to move a bill with just a few of the economic development provisions, including Quality Jobs, Enterprise Zones and New Markets Tax Credits.

The MEDC is committed to working with the Governor and legislative leaders to pass our Quality Jobs and Enhanced Enterprise Zone legislation. We will need to wait and see if legislative leaders and the Governor can agree on terms for a special session.