Swan: Legislature needs to control tax credits, introduces one herself

State Rep. Kathy Swan wants the Missouri Legislature to take budgetary control of state tax credits, even as she seeks to add another tax credit.

For the third year in a row, the Cape Girardeau Republican has introduced legislation that specifies all new and existing tax credits must be approved by lawmakers as part of the budget process.

Swan said lawmakers have no control over tax credits issued by various agencies and departments of state government.

“From a business standpoint, it doesn’t make sense to me,” Swan said.

While running for re-election last year, Swan called the state budget and tax credits “our biggest challenge” in state government.

Missouri has more than 60 tax-credit programs, Swan said.

The programs are designed to boost economic development, historic preservation and low-income housing, among other things.

The annual total of all tax credits has varied from $400 million to $600 million, Swan said.

She said tax credits affect the $27 billion state budget, cutting into state revenue. In putting together the state budget, “the first place we should look at is controlling costs,” she said.

But Swan and other lawmakers already have introduced at least 20 bills for the coming legislative session that would create new tax credits and tax breaks.

The session starts Wednesday.

Swan has drafted a bill that would allow taxpayers to receive a tax credit of 50 percent of their contribution to qualified organizations that provide funding for unmet health, hunger and hygiene needs for school children.

Swan sees no conflict between her two measures.

“There is not a disconnect,” she said.

Swan said her desire for lawmakers to have a say in the total dollars that the state can afford each year in tax credits “does not have anything to do with looking at the merits” of various tax credits.

“It doesn’t place a value judgment on individual tax credits,” she said.

A state-authorized study of tax credits in 2010 reported tax-credit redemptions grew from $102 million to $521 million from 1998 to 2010, a more than 400 percent increase over that period.

Governor-elect Eric Greitens has indicated he may oppose any attempts by lawmakers to expand the number of tax breaks when he takes office later this month.

Greitens publicly has criticized a plan to offer $40 million in tax credits to build a soccer stadium in downtown St. Louis.

He said the proposed tax credits amounted to “welfare for millionaires.”

mbliss@semissourian.com

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