Missouri Senate

House Committee Substitute

An existing headquarters may receive tax credits for new or expanded business facilities for expansions done before January 1, 2018. At least five hundred new employees and at least twenty million dollars in new investment must be attributed to the expansion. Buildings on multiple, non-contiguous property will be considered one facility if the buildings are within five miles of each other. Under current law, up to one hundred thousand dollars in tax credits from the Rebuilding Communities Tax Credit Program can be issued to taxpayers who modify their home to be accessible for a disabled individual who resides with the taxpayer. This act allows all unused tax credits from the Rebuilding Communities Tax Credit Program to be used by taxpayers who modify their homes for this purpose.

The director of the Department of Economic Development is authorized to issue binding letter rulings regarding an applicant's eligibility for issuance of tax credits under the new markets tax credit program.

The true value in money for assessment purposes of any possessor interest in real property located on or within the ultimate airport boundary shown by a federal airport layout plan of the Kansas City International Airport will be the true value in money of the possessor interest in the real property less the total costs paid toward any new construction or improvements completed on the property after January 1, 2008, if included in the possessor interest, unless paid by the political subdivision, regardless of the year the costs were incurred.

The act creates a property tax credit, beginning January 1, 2009, for expenses incurred to manufacture, maintain, or improve a freight line company's qualified rolling stock up to the amount of its tax liability. The state will annually reimburse a political subdivision for any loss in revenue.

Under current law, purchases of materials, replacement parts and equipment purchased for use directly upon, and for the repair and maintenance or manufacture of aircraft engaged as common carriers of people and property are exempt from state and local sales tax. This act would expand the exemption to apply purchases of materials, replacement parts and equipment purchased for use directly upon, and for the modification, repair, replacement and maintenance of aircraft, aircraft power plants, and aircraft accessories from January 1, 2009, to January 1, 2015. All sales of tangible personal property included on the United States munitions list that are made to a foreign government for a governmental purpose are exempted from state and local sales and use tax. The definition of "commercial aircraft" as it relates to the taxation of aircraft is modified by lowering the maximum certified gross take-off weight from seven thousand to three thousand pounds.

Certain municipal library districts which have transferred a structure at least seventy-two years old to a nonprofit entity for rehabilitation are allowed to be deemed a corporation and a for-profit entity for the purposes of the Historic Preservation Tax Credit Program.

The Department of Economic Development may authorize up to five million dollars in tax credits per year to encourage equity investment in technology-based early stage Missouri companies, commonly referred to as angel investments. Investors who contribute the first five hundred thousand dollars in equity investment to a qualified Missouri business may be issued a tax credit equal to thirty percent of the investment or forty percent of the investment if the qualified business is in a rural area or distressed community. An investor can receive a credit of up to fifty thousand dollars for an investment in a single qualified business and up to one hundred thousand dollars for investments in more than one qualified business per year. These credits can be carried forward for up to three years or sold.

Currently, some demolition activities associated with Brownfield redevelopment are separate from remediation activities. The act specifies that all demolition activities are part of remediation and allows remediation tax credits to include up to one hundred percent of demolition costs that are not directly part of the remediation but are necessary to accomplish the planned use of the facility. Demolition may occur on adjacent property that independently qualifies as abandoned or underutilized and is located in a municipality with fewer than twenty thousand residents.

The aggregate cap on the amount of tax credits the department may authorize for the Small Business Incubators Program is increased from five hundred thousand dollars to two million dollars.

Current law prohibits the approval, award, or issuance of tax credits for qualified research expenses after January 1, 2005. The act removes the prohibition on approval, award, and issuance and allows a tax credit equal to no more than six and one-half percent of a taxpayer's qualified research expenses. The annual aggregate cap on the amount of these tax credits that can be authorized by the department is increased from nine million to ten million dollars. Qualified research expenses will be limited to those incurred in the research and development of agricultural biotechnology, plant genomics products, diagnostic and therapeutic medical devices, and prescription pharmaceuticals consumed by humans or animals. Expenses incurred in the research, development, and manufacturing of power system technology for aerospace, space, defense, or implantable or wearable medical devices are also permitted. The director of the department of economic development may allow a taxpayer to transfer up to forty percent of the tax credits issued, but not yet claimed, between January 1, 2009, and December 31, 2015. Applications for qualified research expense tax credits must be filed between January 1st and July 1st for claims for the previous year and the director must act on such applications between August 1st and August 15th of each year. No one taxpayer can be issued more than thirty percent of the total amount of tax credits authorized in any calendar year.

The cap on annual issuance of tax credits for the enhanced enterprise zone tax credit program is increased from fourteen million to twenty four million dollars.

Currently, the Department of Economic Development is prohibited from issuing more than forty million dollars in tax credits for the Quality Jobs Program annually. The act eliminates the annual cap on tax credit issuance under the Quality Jobs Program. The Quality Jobs Act definition of the term "project facility", is modified to include separate buildings located within one mile of each other or within the same county. The Quality Jobs Act definition of the term "technology business project" is expanded to include any qualified company which owns or leases a facility which produces electricity, or fuel for the generation of electricity, derived from qualified renewable energy sources. Under current law, no new tax credits may be approved by the department of economic development for job retention projects, authorized under the Missouri Quality Jobs Act, after August 30, 2007. This act extends the sunset to August 30, 2013.

JASON ZAMKUS