(Feb. 5, 2007) Rep. David Pearce (R-121, Warrensburg) filed the Missouri Economic Development Code bill today. HB 741 is co-sponsored by Rep. Ron Richard, chairman of the House Special Committee on Job Creation and Economic Development.The MEDCode will allow taxing districts to allocate a portion of their future tax revenues that would result from a project to help finance the project, similar to tax increment financing, but with some important differences. First, all amounts allocated to a project are strictly voluntary. The projects must be public projects (including infrastructure such as streets or publicly owned buildings). Because the program is strictly voluntary, there is no need for a "blight" designation and the program may be used for initial development as well as redevelopment. Also because the program is voluntary, we have addressed objections of school districts to other programs. School districts have objected to having their tax revenue involuntarily redirected without their approval under some existing programs, particularly when the project is a residential project. In a residential project, the school district's workload increases with the number of additional students resulting from the development but the school district receives no additional property tax revenue from such projects. Under the MEDCode, school districts could allocate part or all of their future tax revenue from a project, or nothing at all.
The opportunity the MEDCode will provide for economic developers around the state is obvious. In fact, many local economic developers are already using a similar arrangement and this bill will ensure those developments may continue.
We applaud Rep. Pearce's leadership in filing this important legislation and look forward to working with him for its passage in the coming months.
