SB 0001 Programs Coordinated or Administered by the Dept. of Economic Development
LR Number:S1874.05T Fiscal Note:1874-05
Last Action:09/26/97 - Signed by Governor Journal page:
Title:CCS/HCS/SB 1
Effective Date:Varies
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Current Bill Summary

CCS/HCS/SB 1 - This act provides a wide range of economic development incentive programs.

SECTIONS 99.805-99.865. The act makes the following changes in the Tax Increment Financing (TIF) law:

1. The act defines "redevelopment area," "special allocation fund," "gambling establishment", "collecting officer", and "economic activity taxes". A municipality must make a finding that redevelopment of an economic development area will not be solely used for development of commercial businesses which unfairly compete in the local economy. TIF plans and projects are prohibited from including the development or redevelopment of gambling establishments. In addition, personal property taxes and certain other local taxes are excluded from being included as economic activity taxes for TIF projects.

2. Municipalities must be established for one year or longer before TIF projects or areas may be approved in those municipalities.

3. The act requires a cost-benefit analysis as part of the redevelopment plan which shows the economic impact on taxing jurisdictions if the project is not built and if it is built using TIF. The analysis must also include a fiscal impact study on every affected political subdivision and information indicating the financial status of the developer.

4. Municipalities or TIF commissions are required to establish procedures for obtaining competitive bids and proposals for implementation of the redevelopment projects. For minor changes to the redevelopment plan, project, or area, additional public hearings are not required.

5. The bill allows, beginning January 1, 1998, certain blighted areas of municipalities with approved plans and projects to receive appropriated amounts, from the newly created Missouri supplemental tax increment financing fund, of up to 50% of "new state revenues", defined as either 1) state sales taxes, except those which are constitutionally dedicated, School District Trust Fund taxes, sales and use taxes on motor vehicles, trailers, boats and outboard motors, and future sales taxes earmarked by law, or 2) state income tax withholding. Before the initial appropriation of new state revenues is made, municipalities must satisfy the following conditions: 1) apply to the department of economic development and the office of administration, making the election between sales tax or income tax withholding and providing tax revenue estimates, bond issue information, affidavits signed by the developers specifying that the project would not be developed "but for" the appropriation, and a cost- benefit analysis; and 2) receive a certificate of approval from the department of economic development and the office of administration. Each commission is required to report to the director of the department of economic development information relating to businesses which relocate to that district. An aggregate annual appropriation of new state revenues for super redevelopment areas is limited to fifteen million dollars. The duration for any redevelopment plan or project receiving new state revenues is limited to fifteen years, unless the department of economic development and the office of administration approve a longer term, up to a maximum of twenty-three years. Administrative costs of applications for new state revenues are to be paid by the developers of the projects.

SECTIONS 100.255-100.297. The act makes changes to the Missouri Development Finance Board Act. The definition of "development agency" is expanded to include any governmental, quasi-governmental or quasi-public corporation. The definition of "project" is expanded to include office buildings, nursing or retirement facilities, recreational facilities, cultural facilities, public facilities, and job training or other vocational training facilities. The act removes the current requirement that two commercial lenders must deny a loan or bond issue request that exceeds one million dollars for infrastructure facilities projects before such a request may be approved and the loan or bond issued from the infrastructure development fund. The tax credit allowed to owners of defaulted revenue bonds for infrastructure facilities is authorized for any financial institution or guarantor which executes any credit facility as security for such bonds.

SECTIONS 100.760-100.840. The act allows the Missouri Development Finance Board to consider, in allowing a credit under the Business Use Incentives for Large Development Act (BUILD), incentives provided by local political subdivisions, including cash or in-kind incentives and relief from local taxes. The act also increases the limit on the total amount of revenue bonds or notes for BUILD projects from thirty-five million dollars to seventy-five million dollars.

SECTIONS 135.100-135.247. The act revises certain tax credits available to taxpayers operating new business facilities located within enterprise zones. Existing law prohibits certain new business facilities from qualifying for tax credits after the initial ten-year period, even if the business is expanded. This act would allow taxpayers eligible for enterprise zone tax credits to qualify for new business facility tax credits if otherwise eligible. The definition of "revenue producing enterprise" is expanded to include computer programming. The act authorizes the department of economic development to create enterprise zones in the cities of St. Louis (SECTION 1) and Clinton.

SECTIONS 135.400-135.405. The act changes the definition of "community development corporation" in the Missouri small business investment tax credit program and caps the total amount of tax credits available for qualified investments in Missouri small businesses at five million dollars. The tax credit is allowed for ethanol producers.

SECTION 135.460. The act also revises existing law concerning tax credits for contributions to school and youth programs under the Youth Opportunities and Violence Prevention Act. Current law permits only individuals and certain classes of corporations to take the tax credits. The act permits individual proprietorships, partnerships, and S Corporations to take the credits and expands the taxes against which the credits may be taken to include corporation franchise tax, financial institutions tax, and bridge, express, and public utility tax.

SECTIONS 135.500-135.516. The Missouri certified capital company law is amended to cap at ten million dollars the maximum amount of certified capital in one or more certified capital companies in any year for one investor or its affiliates.

SECTION 143.451. The act provides a method for determining qualifying sales, for purposes of state income tax, of an investment funds service corporation. Another provision of the act (SECTION 620.1350) allows such a corporation to elect to compute the portion of income derived from sources within this state under the shareholder-residence formula contained in 143.451 or under the three-factor formula of the Multistate Tax Compact.

SECTION 143.805. Current law specifies the order in which various tax credits may be taken against state income tax. The act repeals that requirement.

SECTION 178.895-178.896. The act extends the Community College Job Training tax credit program for another ten years.

SECTIONS 253.545-253.561. The act allows an income tax credit and a financial institutions tax credit for costs incurred in the rehabilitation of a historic building in a historic district. The credit is allowed in an amount equal to twenty- five percent of total rehabilitation costs if those costs exceed fifty percent of the total basis in the property and the rehabilitation meets the standards of the state historic preservation officer. The tax credit provisions are effective January 1, 1998.

SECTION 447.710. Moneys from the repayment of loans and loan guarantees are to be placed in the Property Reuse Revolving Fund.

SECTION 620.030. The department of economic development is authorized to contract with the Missouri technology corporation, innovation centers, small business development centers, centers for advanced technology, and other entities for the provision of technology application, technology commercialization, and technology development services.

SECTION 620.1023. The act allows the department of economic development to use the Business Extension Service Team Fund to contract with community development corporations for job training.

SECTION 620.1039. The act expands the tax credit for qualified research expenses to be allowed against financial institutions tax.

SECTIONS 620.1069-620.1078. Diligent efforts are required to assure that at least thirty percent of the moneys in the Microenterprise Revolving Loan Fund are available to, and reserved for, female-owned microenterprises. The microenterprise loan program is changed to authorize challenge loans to eligible lenders.

SECTION 620.1350. An investment funds service corporation is allowed to make an annual election to compute the portion of income derived from sources within this state under either the single factor formula or the three-part formula of the Multistate Tax Compact.

SECTION 1. The act authorizes the department of economic development to create an enterprise zone in the City of St. Louis.

SECTION 2. The act establishes the International Economic Development Exchange Program for college students and a related advisory committee.

SECTIONS 3-4. The department of economic development is authorized to assist community development corporations in forming a Missouri community development corporation association and is required to establish a public-private partnership to be known as the Missouri Community Development Corporation Initiative.

SECTIONS 5-7. The act creates the St. Louis Regional Sports Complex Authority, composed of eight commissioners, to study and review existing major sports leagues, clubs or franchises and to analyze the possibilities for future growth and expansion of those sports organizations.

SECTIONS 8-11. The Missouri housing commission is authorized to establish a two-year pilot project in St. Louis and Kansas City for the purpose of renovating inner city property for subsequent purchase.

SECTION 12. The act creates the Task Force on Trade and Investment, designed to establish international trade and investment opportunities for Missouri business.

SECTIONS 13-15. The act creates the Kansas City Regional Sports Complex Authority, composed of eight commissioners, to study and review existing major sports leagues, clubs or franchises and to analyze the possibilities for future growth and expansion of those sports organizations.

SECTION 16. The department of economic development is required to reimburse contractors for services related to job training and development programs as provided in that contract.

SECTION 17. The act requires the Task Force on Trade and Investment to identify and aid those airports considered crucial for the state's economic development; those airports are made eligible to apply for grants from the aviation trust fund.

The act contains rulemaking authority for various agencies.