Iowa Governor Chet Culver plans bill-signing ceremony at Mississippi Valley Regional Blood Center; law supports cost containment, promotes job growth by ending tax on blood testing reagents, equipment.

Davenport, Iowa -- Iowa Governor Chet Culver will visit the Mississippi Valley Regional Blood Center (MVRBC) later this week to sign a new law that will assist MVRBC in developing a regional testing laboratory with other Midwestern blood centers. The bill-signing ceremony is scheduled for 3:30 p.m., Wednesday, April 21 at MVRBC's Headquarters building (5500 Lakeview Pkwy., Davenport). State Senator Joe Seng, who sponsored the bill, will also attend the ceremony.

The bill includes a provision that would exempt a planned regional testing laboratory from paying state sales tax on testing reagents and equipment, a tax that currently costs MVRBC more than $400,000 annually. It received bipartisan support from all of the Iowa Quad Cities' legislative representatives. "This tax is ultimately paid by the hospitals and patients we serve," said MVRBC President David Green, noting that Iowa was the only state in the Midwest to tax not-for-profit community blood centers on their testing reagents and equipment. "We are grateful for the efforts of Sen. Seng and his colleagues in Des Moines to end this unfair tax and we are pleased that Gov. Culver has chosen our facility as the location where the bill will become law."

The regional testing laboratory would consolidate testing of blood donations for a group of Midwestern blood centers. Participating blood centers would lower their testing costs by integrating testing operations at a single location to leverage economies of scale. "Testing every unit ensures the products we provide to hospitals are safe, and that is our first obligation," said Green. "But there is a substantial fixed cost in running a laboratory to test blood. We will contain those costs by working together with others who have similar needs."

While it will help contain the cost of healthcare, the tax exemption on testing reagents and equipment is also viewed as an economic development bill because the tax, which is not assessed in neighboring states, was an impediment to locating the laboratory in Iowa. "This law helps us retain and grow high-quality jobs in our community as we continue our role in providing a critical resource to hospitals throughout our region," said Green.

If the regional laboratory is not developed in Iowa by January 2011, the tax exemption will expire. Discussions about the size and scope of the regional laboratory are ongoing.

Announcements of which centers are involved and the number of staff that would be hired to work in the laboratory cannot be made until agreements are finalized. "By signing the tax exemption into law, Gov. Culver allows to move forward in those discussions knowing we can locate this project in Iowa without paying an unfair tax on the purchase of testing reagents," said Green.

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