TOPEKA, Kan. (AP) — Republican Gov. Sam Brownback and members of his administration are supporting a measure before the Legislature intended to increase investment in agriculture production, dairy and poultry operations.
A bill being considered by lawmakers would give more than $10 million in sales tax exemptions and corporate income tax credits to large firms involved in animal agriculture.
The administration envisions the changes would spawn growth of new production facilities for milking cows and laying eggs, as well as provisions for raising other livestock for slaughter.
"It makes sense to include production agriculture in the tax incentives that help generate investment in Kansas," said Dale Rodman, secretary of the Kansas Department of Agriculture.
Commerce Secretary Pat George said businesses would eligible for a 10 percent tax credit on new capital investment and sales tax exemptions on the projects' expenditures, leading to more job growth and economic activity.
The bill includes retroactive clauses that would allow businesses to get credit for investments made in 2012.
Some lawmakers told the Topeka Capital-Journal (http://bit.ly/100HMx9 ) for a Monday story that they have concerns the bill doesn't follow the spirit of the High Performance Incentive Program, which was created to encourage future business expansion.
Sen. Pat Apple, a Louisburg Republican, said HPIP wasn't intended to help companies that already had made investments in the state but to encourage new firms to enter Kansas.
"HPIP is designed to create future jobs. I'm really struggling with the retroactivity of this," said Apple, a member of the tax committee.
Sen. Tom Holland, ranking Democrat on the tax committee from Lawrence, also questioned whether the change meets "the spirit" of the law passed in 2011.
The Kansas Farm Bureau, Kansas Pork Association and the Kansas Livestock Association have endorsed the bill.
Aaron Popelka, a vice president with KLA, said the policy change would correct exclusion of animal agriculture to the tax incentives offered to nearly every other manufacturing and production industry in Kansas.
"Agriculture is the backbone of this state and is the second largest industry in Kansas as a percentage of gross domestic product," Popelka said. "Agriculture deserves to be treated like other manufacturing and production industries."
Rodman said the administration would use the expanded policy to help state efforts to attract more dairy processing to Kansas, noting two-thirds of the milk produced in the state is shipped elsewhere for processing.
"We have some major companies looking at Kansas," Rodman said. "We don't want to turn them away."
Not all agriculture associations agree with the changes.
"There's no transparency," said Nick Levendofsky of the Kansas Farmers Union. "It distorts the true market economy."
Information from: The Topeka (Kan.) Capital-Journal, http://www.cjonline.com