Nixon Plan Would Add Thousands of Jobs at Auto Supply Plants

7 years 4 months 4 weeks ago Wednesday, January 25 2012 Jan 25, 2012 Wednesday, January 25, 2012 1:03:00 PM CST January 25, 2012 in News
By: Meghann Mollerus
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MEXICO - Governor Jay Nixon announced Wednesday his Missouri Works plan to create more than 3,000 jobs relies on the cooperation of auto supply plants across the state.   But, the fate of this plan's effectiveness now largely relies on the cooperation of house and senate Republicans in drafting legislation. 

Nixon's plan entails offering auto suppliers economic incentives if they "meet specific requirements for job-creation and capital investment," according to Nixon.  These incentives include allowing companies to keep, for up to five years, five to six percent withholding tax to offset costs of hiring.   Nixon said he reached similar agreements with Ford and GM in the past with a 10 percent withholding tax.  The companies pledged last October to invest a combined $1.5 billion to create around 3,200 jobs in Missouri, including 1,600 at the Ford Claycomo plant. He said, "We must build on this investment to expand our network of existing suppliers and bring new suppliers to the state."

Nixon spoke to a small group of media and employees Spartan Light Metals, Inc., one of the plants that potentially could open up jobs in its base city of Mexico. Ted Wattemate, Spartan's vice president of operations, said the plant currently has 206 employees and 80 temporary labor employees. If legislation were to pass, Wattemate said Spartan would roll over about half of these temporary labor employees to full time. 

Nixon's pledge to implement the plan comes after his State of the State address last week, in which he outlined Missouri Works and cited the success of the Missouri Manufacturing Jobs Act.  He said, "Today, I'm proud to report that a bi-partisan coalition of state senators and representatives have filed legislation to turn our Missouri Works auto legislation into law.  I appreciate the folks on both sides of the aisle who have come to sponsor this kind of legislation."

Although Representative Chuck Gatschenberger (R-Lake St. Louis) sponsors the House version of the bill (House Bill 1455), Majority Floor Leader Tim Jones (R-Eureka) said not all Republicans entirely support specific legislation measures--nor do they support creating the auto supplier jobs within Nixon's preferred time frame of "now," as he said in his speech. 

"Republicans in the house have consistently supported such initiatives...it's great for the Governor to throw out a broad statement with a lot of lofty rhetoric, but I can tell you that the hard part comes in when we actually have to legislate these items. The devil is definitely in the details," Jones said. 

Jones added creating Missouri jobs within the auto industry isn't necessarily a top priority.  "There's a lot of focus right now on exactly what type of economic development tools we should be using, especially with the backdrop of the Mamtek fiasco, the problems we've had in Missouri with the wireless company and in Cape Girardeau with the individual who was in trouble for criminal investigations that the governor wanted to supply tax credits to.  I can tell you that we're going to be looking at these very carefully before we just throw around any more of the taxpayer dollars."

In terms of costs of implementing the initiative, Nixon said, "As far as up front dollars, it doesn't cost us anything.  What this is if the dollars are invested, the products are obtained and the jobs are created, then the companies, for an offset of their costs, will be able to keep for up to five years a piece of this withholding tax for employees working that job."

KOMU 8 News talked with residents of Mexico, who said they were in support of an effort that not only could benefit Missouri in general, but also could give many Mexico residents full-time jobs with Spartan. 

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