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Mo. Senate Debating Incentives for Boeing Facility

By DAVID A. LIEB Associated Press
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(ALEXANDER KLEIN/AFP/Getty Images)

(ALEXANDER KLEIN/AFP/Getty Images)

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JEFFERSON CITY, Mo. (AP) - Missouri senators touted the potential for thousands of jobs as they opened debate Wednesday on legislation offering up to $1.7 billion of incentives over two decades for Boeing to build a new commercial airplane in the St. Louis area.

The incentives, which are tied to job creation, are the sole focus of a special session called by Gov. Jay Nixon as Missouri contends with more than a dozen other locations to produce the next-generation 777X airplane.

“It’s a proposal that allows us to compete for quite literally thousands of direct jobs and tens of thousands of indirect jobs” when counting the network of businesses that supply parts, said Sen. Eric Schmitt, R-Glendale, who is sponsoring the legislation. “These are long-term, good-paying, quality jobs.”

Boeing already employs about 15,000 people in Missouri, giving it the state’s fourth-largest private sector payroll.

Supporters of the incentive package say Missouri could gain 8,000 additional Boeing jobs if it chooses to assemble the new commercial airplane in Missouri, and 2,000 to 3,000 jobs if Boeing decides to build only the airplane wing in St. Louis.

Boeing could get an aggregate of about $435 million of incentives by 2040 if it adds 2,000 jobs in Missouri and up to $1.74 billion if it adds about 8,000 jobs, according to an analysis released Tuesday by Nixon’s administration.

The company also could receive a still unspecified amount of aid from local St. Louis area governments.

The analysis also shows Missouri would receive more in new tax revenues from the Boeing expansion than it would waive through incentives.

On Wednesday, some Republican senators questioned the wisdom of giving such a large incentive package to Boeing. They bemoaned the fact that Nixon vetoed a broad-based income tax cut earlier this year that would have affected nearly all businesses and individuals.

“Basically, really we’re just giving hundreds of millions of dollars to this one company it just seems so hypocritical or so inconsistent,” said Sen. Rob Schaaf, R-St. Joseph.

Boeing invited other states to submit proposals for its 777X airplane after union machinists in Washington state rejected a proposed contract that would have raised health care costs and replaced their traditional pension with a defined contribution savings plan.

Mike Louis, secretary-treasurer of the Missouri AFL-CIO, said the local machinists union in St. Louis already accepted pension terms starting in January 2012 similar to what was rejected in Washington. So he said that shouldn’t be a hurdle if Missouri is awarded the new airplane assembly.

On Tuesday, Nixon also announced that several labor councils in St. Louis had agreed to make construction workers available around the clock in three, eight-hour shifts that would avoid overtime pay while speeding up the completion of a potential new Boeing facility.

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