Improving the Economy & Creating More Jobs in Missouri

This week the Missouri House perfected and printed several pieces of legislation relating to economic development.  The Republican-led legislature continues to look at measures that will facilitate the growth of our economy and encourage the creation of more jobs for our fellow Missourians.

Supporting Missouri’s Export Industry

Did you know that Missouri exports over $14 billion worth of goods each year according to the most recent estimates?  Our state, regional, and local economies literally depend on the ability of Missouri businesses to find foreign markets to sell items grown and produced on Missouri farms or in Missouri manufacturing centers.  When our local businesses thrive, they employ our neighbors, they invest in their family’s future, and they help fund critical local public services – roads, schools, public health initiatives, firemen, police officers, and the like.

 

It’s no secret that the best way to help someone is to make sure they have a job – and our exporters are doing great work to ensure the jobs are there.  Sometimes, though, our state gets a little in the way with burdensome taxes that inhibit the full potential of our private sector.  Your Republican-led legislature has taken notice and is taking steps to help get out of the way and encourage the private sector to do what it does best – provide a strong quality of life for Missourians.

 

There are a variety of proposals before the House that are aimed at helping our freight forwarders, those who get our products from Missouri soil to their final destination worldwide, realize their full potential.  We’re taking steps now to make sure we make the smartest and most economical decisions that will remove barriers to exporting, support Missouri farm and manufacturing industries, and encourage prosperity.

 

House Moves to Incentivize Data Storage Industry

In the age of computers and mass storage of information, a new industry has emerged that has a strong presence across the United States, employs thousands, and is proving incredibly beneficial to local, state, and national economies.  That industry is the Data Storage Industry and as the name implies they house servers which store massive amounts of information for businesses, not-for-profits, and government entities.  They are basically incredibly high-tech warehouses. 

 

What’s the House of Representatives’ Proposal?

 

The Republican-led legislature moved to allow a state and local sales and use tax exemption for qualifying investments from the private sector.  There’s a catch, though, designed to safeguard the public’s dollars: not a single exemption will be allowed until the private investment is made and the exemption is limited to the net fiscal benefit of the state over the next 10 year period.  It’s a great way to get companies to come to Missouri while guaranteeing the investment. 

 

Why Would We Want Them?

 

The industry currently is one that is valued at $30 billion in the US, $100 billion worldwide, and it’s growing at a remarkably fast pace – 8% annually.  That means if we can get their business in Missouri, they’ll not only add jobs up front but will continue to do so in the long-term. 

 

Who Else Would Benefit?

 

The investment in the facilities required would alone be a boon to the local economy, so cities and counties would stand to see increased economic activity.  The construction costs are $1,300 per square foot, so the construction companies and their employees stand to gain tremendously.  Keep in mind that your average warehouse construction costs are only $50 per square foot, so the difference is stark and significant.  Beyond the initial construction jobs, the industry employs tech-savvy employees and the average salary is $75,000 per year.  If Missouri had only a 5% share of the industry, that would mean $56 million in annual payroll and the benefits like health insurance that come with it.  

 

Is Missouri Even A Viable Candidate?

 

Yes.  Our low cost and abundant energy – a major consideration for the industry – makes us an attractive state to set up shop.  On top of that, we have the availability of fiber communications and strong IT talent in our workforce.  We must act quickly though, as our neighboring states are already incentivizing the industry.  Iowa, Nebraska, and Oklahoma have already landed major investments from companies like Microsoft, Yahoo, and Google.

 

Missouri’s Angel Investors Play a Big Role in Economy

Each year the private sector takes huge risks on emerging business ideas.  The successful ones have huge payoffs for everyone.  They create new jobs, economies grow, and local and state governments benefit from increased revenues and fewer of their citizens relying on social safety net systems.  But “Angel Investors”, folks who invest their hard earned money in new business ideas, sometimes pick a losing product or market.  Missouri’s Republican-led legislature knows that the private sector is better-suited to handle many of the problems a society might face.  However, if the risk is too great the private sector reacts by holding back its potential.  We’ve taken notice and we think we have a strong proposal to encourage angel investors to take risks and support continued job creation, investment, and growth.

 

Representative Noel Torpey (R-Lee’s Summit) has filed HB 191 which affords a small tax credit to qualified angel investments.  The seed capital that the investors provide then flows to the new business to take their product or service idea to the market so it can be successfully sold.  It’s a small tax credit that will have a large impact.  When businesses are successful, they increase payrolls, they provide health coverage and other insurances, and they and their employees pay taxes.  On top of that, they provide an avenue for increased consumer spending which catalyzes even more growth.  In the long run the small investment that the State commits will have exponential growth potential.