Yael T. Abouhalkah

Kill shameful tax breaks for GE and A.B. May in KC area

This region’s economic development border war continues to take money away from providing basic services and instead put it into the pockets of large companies.

The latest losers: Raytown and Leawood.

The latest winners: GE and A.B. May.

The state tax breaks being offered to both these companies should be killed by Gov. Sam Brownback in Kansas and Gov. Jay Nixon in Missouri.

This is just another case of companies hopping across the state line and creating few if any new jobs or economic benefits for the entire region. It’s financially destructive partly because it means taxpayer incentives are being given to existing companies, not to get new employers to the area.

Both governors need to get serious about stopping the border war that has helped companies but hurt the people who live in this region and who count on tax revenues to provide services for them.

Indeed, just days ago, Brownback provided some much-needed leadership on this issue. He said he was ready to start talking about preventing Kansas state incentives from being given to companies that merely go from one state to another in the KC area. That was a ray of sunshine in this entire dispute.

GE is hoping to get a big taxpayer incentive from Kansas by leaving Raytown and moving into the Sprint campus buildings in Overland Park. Think about: A multi-national company that earns billions of dollars a year will leave an inner-ring suburb and try to avoid paying almost all of its state income taxes to Kansas through the Promoting Employment Across Kansas program.

Brownback has the power to stop that tax break and should.

A.B. May wants a similar tax break through the Missouri Quality Jobs program, allowing it to get out of paying its state taxes for many years. A.B. May wants to relocate out of Leawood and move to a building near Interstate 435 and Sni-a-bar Road.

The A.B. May deal does come with one caveat: At least that company, if it completes the move, would be going to an urban area that needs to be redeveloped.

So the Kansas City Council likely will approve bonds to help make the project work.

However, the state part of the incentives should not be awarded and Nixon should find a way to prevent them from being given out.

This is one border war that needs to stop.