- Introduced -

SB 867 - This act limits the Certified Capital Companies (CAPCO) operating and organizational expenses for tax purposes to 10% of the value of the CAPCO capital for CAPCOs created after August 28, 2000.

Under current law, businesses qualifying for CAPCO investment are limited in sales to $3 or $4 million annually. This act allows CAPCO investment in a business with up to $7.5 million in sales for the first year if such investment is made within four years of establishment of the Certified Capital Company with at least 25% of its certified capital invested in a "Qualified Missouri Stage Development Business".

A "Qualified Missouri Stage Development Business", authorized in this act, is an emerging industry as designated by the Department of Economic Development, or an industry with less than $2 million in sales in the most recent fiscal year.

Under current law, the Director of the Department of Economic Development could reduce the percentage of the 100% tax credit earned against state premium tax liability for an investment until August 28, 1999. This act allows the Director to reduce credit for investment during the period of August 28, 2000 to August 28, 2005.

This act also removes the $10 million cap on the aggregate amount of CAPCO tax credits allowed in any one year and sets a new cap of 10% of the cumulative amount of credits earned for certified capital invested in previous years. Not more than 5% of the proceeds form the initial certified capital investment may be invested in an insurance company or any of its affiliates.

ELIZABETH BAX