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China Hub Makes Its Return to Missouri Statehouse

Nick Thompson
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JEFFERSON CITY (MDN) — A Southwest Missouri manufacturer testified before a Senate committee that an international cargo hub, previously dubbed “China Hub,” at Lambert St. Louis Airport would likely cut off a day’s worth of travel time on the company’s global shipments of compressors for appliances.

Keith Calhoun, the Lebanon plant manager with Emerson Electric, said a new hub at St. Louis would mean less time, less money and more efficiency. Currently his goods take off from Chicago.

A new bill (SB 120) in the Missouri Senate is attempting to revive what similar proposals from 2011 and 2012 set out to accomplish. The bill would provide tax breaks to attract international air cargo shipping at the St. Louis airport.

The bill, sponsored by Sen. Eric Schmitt, R-Glendale, would allow the state to issue tax credits to companies that are referred to as freight forwarders. Those forwarders will receive per-unit credits on their exports when qualifying outbound flights take off to foreign destinations. The bill requires the state to cap the authorizations of the credits at $7.5 million each year.

Schmitt, who chairs the Senate Jobs Committee, said Wednesday that air commerce is growing rapidly around the world. Schmitt said the hub could put Missouri on the map for carriers and spur its competitiveness on a regional and global scale.

Missouri shipped $2.5 billion worth of cargo by air in 2011, according to the St. Louis World Trade Center.

“This is an opportunity for us to become a marketplace where there is a reliability,” Schmitt said. “There’s a schedule and the freight forwarders know that they can get their goods through St. Louis.”

Schmitt’s bill does not contain sections of the 2011 legislation that included tax breaks for companies to build warehouses and other infrastructure. Schmitt said he thought the forwarder legislation has enough merits of its own to be separate from the previously proposed provisions.

“I wanna push this process along so we do not miss the opportunity that is there, ” Schmitt said.

Dan Mehan, the President and CEO of the Missouri Chamber of Commerce, said the incentives will serve like a travel agent for freight forwarders in getting them to locate to the region.

“Once you see that (the incentives) starting to happen I think the free market will come in a large way and if there is an opportunity to build a warehouse they’ll jump on it,” Mehan said.

An airport official also noted that the airport can handle and welcomes the prospective activity. At Lambert, cargo currently constitutes only 2 percent of the air traffic, something Rhonda Hamm-Niebruegge, Director of Lambert St. Louis, said brings in heavy revenue. Overall Hamm-Niebruegge said the airport is operating at medium capacity.

“We can be both a large cargo hub and a large passenger hub, and when we do both this whole state prospers,” Hamm-Niebruegge said.

At the Senate hearing, no one testified against the bill. In the past, “China Hub” proposals have not passed because some state lawmakers have been hesitant to authorize new tax credits.

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