Legislature adopts bill to help state compete for Boeing 777X production

JEFFERSON CITY — Just one week after calling a special session of the General Assembly, Gov. Jay Nixon today — Friday — praised final passage of Senate Bill 1, bipartisan legislation to help Missouri compete for production of Boeing’s next-generation commercial aircraft, the 777X.

With more than a dozen states competing to build the 777X, Nixon called the Legislature into a special session to consider legislation that would help the state submit a competitive proposal for this transformational project. In less than five days, the bill passed the Senate by a vote of 23-8 and the House by a vote of 127-20.

“The highest priority and deepest commitment of my administration has been to create good jobs for Missouri families and move our economy forward — and that is exactly what this bipartisan bill will help us do,” Nixon stated in a news release. “Production of the Boeing 777X would create thousands of high-paying jobs, generate billions of dollars in investment and spur economic growth in every corner of our state. That’s why competition for this next-generation aircraft is so fierce. Today, by reaching across party lines to develop an approach that protects taxpayers and guarantees a return on our investment, we are in a very strong position to compete.”

Senate Bill 1 provides separate capacity of up to $150 million annually for an aerospace project that creates at least 2,000 jobs under four of Missouri’s performance-based economic development programs: Missouri Works, Missouri Works Training, Missouri BUILD and the Real Property Tax Increment Allocation Redevelopment Act. The total amount of benefits Boeing could earn would be based on the number of new jobs created and the wages of those jobs, the amount of new capital investment and the cost of training workers to build this next-generation aircraft.

“I greatly appreciate the General Assembly’s work to send a bill to my desk in a timely manner so that we may submit a competitive proposal to Boeing on the aggressive timetable the company has set,” Nixon stated in the release. “Just as we worked together in a special session in 2010 to revitalize our auto industry and attract historic investments from Ford and GM, Missouri has once again demonstrated to the world that when it comes to creating good jobs for Missouri families, we compete and we compete to win.”

Under these programs, a project must demonstrate a net positive fiscal benefit to the state, before any incentives may be authorized. In addition, companies must invest and create jobs first before being eligible to defray these costs by keeping a portion of the revenue they generate. By retaining these existing safeguards and creating a separate cap to accommodate an aerospace project of this scale, Missouri can compete to win production of the 777X without jeopardizing other economic development projects or investments in public education or other vital services, according to the release.

To meet the company’s workforce needs, Nixon’s administration has formed a consortium of area community colleges to train and certify thousands of additional graduates in aerospace and advanced manufacturing areas to grow a pipeline of highly-skilled workers for this project and others in this sector.

Strong support from St. Louis-area construction labor councils has also given Missouri a competitive edge, as Nixon announced a historic agreement among St. Louis-area construction labor councils to work a 24-hour schedule and forgo overtime. In a letter to the governor, the St. Louis Building and Construction Trades Council, the Eastern Missouri Laborers’ District Council, and the Carpenters District Council of Greater St. Louis committed to 24-hour work schedule without overtime during construction of Boeing’s facilities. This aggressive work schedule would double the number of work hours each week, triple the committed workforce, and reduce the construction time by at least a year, the release stated.

In the summer of 2010, Nixon called a special session of the General Assembly to pass the Missouri Manufacturing Jobs Act and attract next-generation automotive manufacturing to the state. Since then, Missouri’s automotive manufacturing industry has rebounded. Ford and General Motors are investing more than $1.5 billion and creating thousands of jobs to build all-new vehicles at their facilities in Missouri.

This year, the automakers announced plans to put even more Missourians to work, with an additional stamping press at GM’s Wentzville facility and a third shift of F-150 production at Ford’s plant in Claycomo. The historic expansions by Ford and GM have helped spur a parallel resurgence among automotive suppliers all across the state, according to the release.

SB 1, combined with the strong support from the education and labor communities, will help the state to submit a competitive response to Boeing’s Request for Proposal, which is due by Tuesday, Dec. 10.