NPR: Kansas wooed mega employers like Panasonic with mega tax breaks. But that may end
DE SOTO, Kansas — As construction crews build Panasonic’s new $4 billion factory here, the Kansas tax subsidy law that helped bring the electric vehicle battery plant to the state is set to evaporate.
Kansas officials no longer have the power to underwrite mega-deal projects with hundreds of millions of dollars in state incentives. The law, known as APEX, only let the state ink one deal each year in 2022 and 2023. Those tax giveaways for those two years went to Panasonic and Integra’s planned $1.8 billion semiconductor plant in the Wichita area.
Paul Hughes, the state’s deputy secretary for business development, asked lawmakers to extend the law into 2024 and beyond to keep open the possibility of bartering in tax breaks that might tempt other large employers to Kansas.
Gov. Laura Kelly’s administration touts the law as a way for the state to take an active role in boosting the economy.
“You’re not really the captain of your own destiny,” Hughes said of not extending the law. “At that point, you’re just waiting for something to happen and hoping that it does.”
But some influential conservative lawmakers voiced concern over the program and how much the state was giving away.
Meanwhile, Panasonic could earn $6.8 billion in incentives from the federal government, according to a study by government accountability group Good Jobs First. Add in the more than $1 billion from state and local governments, the company could score $8 billion in tax dollars — twice the amount of its original investment to build the plant in Kansas.
Jacob Whiton, an analyst for Good Jobs First, said federal incentives exceeding the amount of company investment is rare.
“It certainly calls into question,” Whiton said, “the necessity of that state and local package in light of the generosity of the federal credit.”
Read the full story at NPR.