SB 323 - This act modifies provisions relating to job creation.
MISSOURI WORKS PROGRAM
This act creates the Missouri Works Program. A qualifying company may retain a certain amount of withholding taxes for new jobs if one of the following three criteria are met: (1) ten or more new jobs are created with the average wage being at least 90% of the county average wage; (2) two or more new jobs are created in a rural area with the average wage being at least 90% of the county wage average and a $100,000 investment has been made in the last two years; or (3) two or more jobs are created in an enhanced enterprise zone with the average wage being at least 80% of the county wage average and a $100,000 investment has been made in the last two years.
In addition to the withholding taxes, a qualified company that creates ten or more new jobs with the average wage being at least 90% of the county average wage may also receive a tax credit up to nine percent of new payroll. No company will be eligible for a total amount of benefits under this program in excess of 12% of payroll. The amount of the tax credit shall not exceed the projected net fiscal benefit to the state or the amount needed to obtain the company's commitment to initiate the project. Criteria are established for the Department of Economic Development to determine the amount of the tax credit. Qualified companies must enter into an agreement with the Department to receive the tax credit, which shall include clawback provisions. No company will be eligible to retain withholding taxes or obtain a payroll tax credit if they have made certain decisions or performed certain tasks before their notice of intent is approved.
If there is a significant probability that a company may relocate to another state, the Department may authorize a company to retain up to 100% of its withholding taxes. The average wage of the retained jobs must be at least 90% of the county average wage, at least 50 jobs must be retained for 10 years, and the company must make an investment of at least 50% of the total benefits it will receive. The amount of benefits awarded to the company cannot exceed the projected net fiscal benefit to the state. The aggregate amount of benefits available to all companies under these provisions is capped at $6 million per fiscal year. Qualified companies must enter into an agreement with the Department to receive the tax credit, which shall include clawback provisions.
The Department of Economic Development is required to responds to request for benefits within 5 days and notice of intent within 30 days. Failure to respond to a notice of intent will result in an approval of the notice of intent.
If a qualified company participates in a job training program authorizing retention of withholding tax, the company will not retain withholding tax under this program but will be issued a refundable tax credit for the amount of the benefit they would be allowed under this program. Companies receiving benefits under the program must file an annual report with the Department. Companies employing individuals that are not legally allowed to work in the United States will be ineligible for benefits under the program. Companies that become delinquent on their taxes will have their benefits authorized under this program reduced by the delinquent amount.
The total amount of tax credits that may be authorized under the program is limited to $106 million for FY 2014, $111 million for FY 2015, and $116 million for any fiscal year thereafter. Tax credits issued under the program are transferable but may not be carried forward or back.
After August 28, 2013, no new benefits shall be authorized under the Neighborhood Assistance Tax Credit Program, the Rebuilding Communities Tax Credit Program, Enhanced Enterprise Zone Tax Credit Program, and the Missouri Quality Jobs Program. Companies receiving benefits under this act are barred from benefit under the Manufacturing Jobs Act for the same jobs.
The Missouri Works Program will sunset on August 28, 2019.
ENHANCED ENTERPRISE ZONES TAX CREDIT PROGRAM
Despite the prohibition of further state benefits under the program after August 28, 2013, governing authorities may still designate zones and provide local tax abatement. This act modifies notification requirements for public hearings before an enhanced enterprise zone may be established. The requirement that the Director of the Department of Economic Development be notified of public hearings and that the Director or Director's designee attend are eliminated.
An enhanced enterprise zone may be created by ordinance or resolution by the governing authority. Approval by the Department of Economic Development is not longer required and the enhanced enterprise zone will become effective upon passage of the resolution or ordinance.
The Missouri Works provisions are similar to SB 794 (2012), HB 1709 (2012), SB 279 (2011), SS/SCS/SB 280 (2011) and SS/SCS/SB 8 (1st Ext. Sess. 2011). The act is similar to provision in SS/HB 184 (2013) and HB 620 (2013).