Crowell

Sen. Jason Crowell was last session’s central character in the senate.  He chose two mountaintops to defend, and ably used the senate rules and traditions to keep them safely within the status quo.  He defeated Ameren’s attempt to pass CWIP, and he kept any real changes in the state’s tax credit programs.

While some senators’ powers stem from their position – Sen. Gary Nodler as Chair of Appropriations, Sen. Charlie Shields as Pro Tem, for example – and other senators gather power through coalitions – the Fiscal Hawks or the Social Conservatives, for example – Crowell is unique.  He’s a singular force by just being himself.  He understands the rules of the senate better than any other senator, and employs them strategically and ruthlessly, and unaffected by the distain of others.

Where will the mercurial Crowell stand during session?  In whose direction will he stick his legislative pitchfork?

Tax Credits

Last week Crowell laid out his proposal for reining in the state’s sprawling tax credit programs.  Under Crowell’s plan, the tax credit programs would be subject to appropriations.  Developers fear this proposal because it would subject their cherished subsidies to an annual review.

Although Crowell put forth the same proposal last year, he was ultimately a great defender of the historic preservation tax credit program. Close observers saw that stance as the result of a blend of motives – his friendships with Jeff Smith and Rep. Steve Tilley; his distrust of Sen. Brad Lager (whose close friend Jeff Roe has warred with Crowell’s close friend Rod Jetton); his belief in the transformative power of the credits; and his inability to win support for his “subject to approps” process.

He may well revert to defend the programs again this year, but his initial thrust is to move the programs under the appropriations process.  And if last week’s hearing was any indication, legislators (including Lager) are generally more receptive to this argument. Those who would oppose Crowell in Senate have far less experience and at present would appear mismatched by his legislative prowess.

Projects in the district of Sen. Robin Wright-Jones’ (Senate 4) have been issued a little more than $473 million in historic preservation tax credits.  This makes sense. St. Louis City is populated almost entirely with historic buildings.  The tax credit was the brainchild of St. Louis lawyers about ten years ago and St. Louis developers were the first and most aggressive to use them.  When the Senate 5 district is added in, that total rises to $530 million for St. Louis City.  Joe Keaveny will take Smith’s seat.  It will be his first experience in Jefferson City.

I spoke to one legislative observer in Kansas City who was unconcerned about the tax credits because “this new guy Cavaanee will just kill it like Smith did.”  His assessment that killing a bill is like pressing a button is true of some bills.  With others, however, it’s like running a marathon, but stopping every mile to make a move in a game of chess.

Over in Kansas City, Sen. Jolie Justus’ district has benefited enormously also – about $180 million in historic preservation tax credits have been issued in her Senate 10. She may take a more active role in defense of the programs if Crowell’s plan gathers steam.  And while those numbers dwarf the others in the Senate, most districts have seen an impact.

The Budget

The greatest ally of those who wish to cut back on the programs is that the state budget continues to surprise on the downside.  The budget axe will be cutting across every department.  Even St. Louis Democrats like Rep. Don Calloway, who has seen the power of tax credits on development, are skittish when imagining that they will preserve the credits while cutting healthcare, social services, corrections and education. 

The shrinking budget is already working to clarify the priorities that legislators have about the role of government.

Nixon and Medicaid

Governor Jay Nixon campaigned on restoring Medicaid cuts and has since become ambivalent about whether the federal government’s healthcare legislation enlarges the population eligible for Medicaid.  Nixon can’t pay for his promise to restore Blunt cuts, and will need to scramble to avoid cuts of his own.  He has begun the process to decrease Medicaid reimbursements to some providers, which is less noxious to liberals but may ultimately have the same long-term effect.

(Some Democrats still grumble that with a twenty-point lead in the polls, he didn’t hedge his commitment to restoring the cuts in the final weeks of his gubernatorial campaign).

For Nixon, and other Democrats, cutting healthcare will echo too loudly of the evil Matt Blunt.  If the Crowell plan offers a chance to trade economic incentives for healthcare spending, they will take that trade every time. 

What is EcoDevo?

According to Crowell, the Department of Economic Development estimates that zero is the number of jobs created so far by last year’s economic development bill.

Despite the congratulatory speeches from both sides of the aisle, there’s no real world data to show that Missouri politicians have a grasp on which incentives work, how well, and over what period of time.  Always they fall back on silly anecdotes or other-worldly numbers based on heavenly assumptions.

Where Does that Leave Tax Credits

Despite the strength of Crowell, the terrible Budget monster, the potential desertion of Democratic allies for social services, and legitimate questions about the effectiveness of current economic development incentives, the tax credit programs may still find shelter in the Republican House leadership. 

Speaker Ron Richard, Reps. Steve Tilley and Tim Jones all appear committed to the status quo on development tax credits. Richard, obviously, has the consistency of a weather vane in April.  But Tilley is capable of singlehandedly derailing a piece of legislation, so a bettor may reasonably take even odds at this time on significant tax credit reform.