Tax credits aimed at building a shipping hub slowly disintegrate in legislature

Legislators in Missouri want the world’s cargo. They’re hoping to turn Lambert-St. Louis International Airport into a new hub for international shipments – an idea they hope will spur job growth in the short-term and create a long-lasting economic impact on the St. Louis region. But these big plans are shrinking by the day.

A bill winding its way through the state legislature foresees the area around the airport as an “aerotropolis," a place that capitalizes on the international flow of goods through airports by providing the infrastructure to handle their shipping and handling. It’s an idea of modern urbanism recently expounded upon in a book by John D. Kasarda and Greg Lindsay.

Missouri officials, including Governor Jay Nixon, have been pushing the idea as a way to grow jobs in a down economy. They originally proposed about $360 million in tax credits to lure shipping warehouses and manufacturers to a zone around the airport, but that figure was recently cut way down, to $60 million. Subsidizing companies that facilitate exports could be, it’s hoped, a way for St. Louis to compete with larger economies like that of nearby Chicago, or even the FedEx-powered shipping behemoth based at Memphis International Airport.

The Aerotropolis Trade Incentive and Tax Credit Act, lumped into an economic development bill in the current special session of the state senate, received first-round approval last week. The cutback in the amount of tax credits has some worried about its potential for passing the house, but Senate President Pro Tem Rob Mayer is confident that the state’s need for jobs will help push it through. Preliminary figures for August put the state’s unemployment rate at 8.8 percent, which is less than the national rate of 9.1 percent.

St. Louis Mayor Francis Slay is also behind the plan, and hopes that enticing freight forwarders to the area will help foster business relations between his city, the state, and China. Slay's been making the case there’s more than 1,100 acres of space for development around the airport, and that its central location in the U.S. and the Midwest region ideally suit it as a shipping hub.

But others contend that the airport is its own competition. State Senator Luann Ridgeway recently attacked the idea, arguing that the airport’s landing fees are much higher than competing airports like Chicago’s Midway and Kentucky’s Louisville International Airport. Unless those fees become more competitive, Ridgway argues, businesses aren’t likely to see St. Louis as the shipping mecca it hopes to become.

The bill is heading next to the state House of Representatives, but its future is cloudy. Steven Tilley, the House speaker, told Missourinet that he couldn’t vote for the Senate’s version.

Image Courtesy Lambert-St. Louis International Airport

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