Food Pantry Tax Credit

Here is a recent Letter to the Editor I sent out. 

Thanks and take care,

Rod Jetton

Dear Editor,

There was a lot of talk about tax credits in the last legislative session.  I would like to recommend one tax credit that would only cost a maximum of $2 million per a year, but will help thousands of Missourians get enough to eat.  It’s the Local Food Pantry Tax Credit Program (LFPTCP) that was started in 2008 and is scheduled to expire August 28th.   

The Oversight Division of the Joint Committee on Legislative Research issued a report showing that the first three years of the four-year program, only $1.5 million of the $6 million available credits were claimed, but use has grown significantly each year, with nearly $800,000 claimed in 2010. The average donation was $450 with 99 percent of the statewide credits being claimed by individual taxpayers.

While the battle rages in Jefferson City about how to reform our tax credit programs.  This program already includes many of the reforms that have been debated. Most tax credit reformers have four main goals, which include:

1.      Cap the amount of tax credits one individual can receive

2.      Keep tax credits from being sold or transferred

3.      Cap the overall amount that can be spent on any one program. 

4.      Sunset all tax credit programs

Most reform advocates believe these changes will make budgeting for future tax credit expenditures more accurate.  They also feel it will allow the programs to be better monitored, so that needed changes can be made. 

I hope the reformers will consider that the LFPTCP program already limits the tax credit amount to prevent one individual or one food pantry from receiving all the benefits.  The amount of the tax credit will be equal to one-half the value of the donation and cannot exceed $2,500 per taxpayer.  The LFPTCP tax credit is also nonrefundable and cannot be transferred, sold, or assigned to other parties. Additionally, the whole program is capped at $2 million a year and it sunsets after 4 years, which will be August 28th.

I am a strong supporter of tax credit programs to attract jobs and spur economic development in our state, and I realize the budgeting problems many of our current tax credit programs present to our leaders.  I also admit that the sale and transfer of tax credits has diluted the economic impact of many of the programs, but eliminating all tax credits would not be wise.  I believe the LFPTCP tax credit program should not only be renewed, but should also be an example of how other tax credit programs could be designed. 

Right now would be a disastrous time to end a tax credit program that has brought additional resources to our local food pantries.  According to the U.S. Department of Agriculture (USDA), Missouri is 7th in the nation in food insecurity, and we have the 5^th highest rate of childhood hunger in America. Over 900,000 Missourians are food insecure. In this tough economy with our states high unemployment rate, each additional dollar that is given to our local food pantries is being used to help feed someone in need.

The Southeast Missouri Food Bank stressed that they are serving more people while the cost of food has almost doubled.  Just look at these numbers. The first six months of 2008 pantries in their service area helped 383,808, but during the first 6 months of 2011 that number has increased by 37,738 to 421,546.  While they have more people needing help they also report higher food costs.  In June of 2010, they spent $1,800 for 40,000 pounds of potatoes, and this June they spent $3,600 for 40,000 pounds of potatoes.

As our leaders consider a special session to pass a multi-million dollar tax credit bill, I urge them to include the LFPTCP tax credit program in whatever package they pass.  It is a small program that includes all the accountability and reform measures being debated, but it will make a major difference to thousands of Missourians across our state. 

Sincerely,

Rod Jetton

Rod Jetton served in the Missouri House from 2001-2008 and was Speaker from 2005-2008.  He authored and passed several law changes designed to improve nutrition programs and increase funding for hunger relief efforts in Missouri.  HB 453 set up the LFPTCP program in 2007 and the tax credit was first available in 2008.  He now lives in Branson, Missouri and works at Schultz and Summers Engineering.