Several Shawnee Mission-area lawmakers were among those to join Gov. Laura Kelly in her office Friday for the signing of an executive order aimed at bringing an end to the “border war” that’s seen companies moving employees from one side of the state line to another to chase tax incentives.
The executive order directs the Kansas Department of Commerce to cease providing any incentives to companies in the Kansas City metropolitan area for moving employees from Missouri to Kansas. In June, Missouri Gov. Mike Parsons signed legislation that restricts that state from awarding incentives to companies moving from Kansas to Missouri in the metro.
In recent years, the states had been offering tax incentives to companies that brought jobs to Kansas or Missouri. But since many of such cases involved businesses moving just a few miles across the state line, there was negligible impact on the economy of the Kansas City metro area. The amount of tax revenue states took in from such businesses, however, was reduced.
“For years, both Kansas and Missouri have implemented incentive programs to persuade companies to jump back and forth between the Kansas and Missouri border – all while remaining in the KC metro area. It’s been wasteful and bad for both states,” Kelly said. “During my campaign I heard how badly the Kansas-Missouri border war affected our businesses in the KC metro area. We must stop using costly incentives to lure a business across the border without any real economic benefit. The goal always should be creation of new jobs.”
However, Kelly noted, to fully address the disparities, the states will need the cooperation of local governments, which have the authority under the Kansas and Missouri constitutions to grant their own tax abatements. Local Kansas governments can grant such abatements for a maximum of 10 years. In Missouri, local governments can grant such abatements for a maximum of 25 years.
“Therefore, this Executive Order asks the local governments to comply with the bistate agreement,” Kelly said. “We are confident our two states can agree this Executive Order benefits Kansas and Missouri in a fair and equal way.”
Shawnee Mission area legislators in attendance at Friday’s ceremony were:
- Rep. Jan Kessinger (R-Overland Park)
- Rep. Nancy Lusk (D-Overland Park)
- Rep. Jarrod Ousley (D-Merriam)
- Sen. John Skubal (R-Overland Park)
- Rep. Jerry Stogsdill (D-Prairie Village)