2007 Final Legislation Affecting MEDC

Note: Unless otherwise indicated, the Governor has not yet signed or vetoed this legislation. The Governor has until July 14 to sign or veto legislation, and if not vetoed by that date, these bills would automatically become law.

HCS HB 184 – CHILDREN’S SERVICES PROTECTION ACT

• Prevents sales taxes levied for Children Services Protection from being diverted to TIF projects after August 28, 2007.

SS HB 205 – TOURISM

• Authorizes local transient guest taxes for Pemiscot County, the City of Sullivan, and part of the Sullivan C-II School District in Franklin County.

• Allows additional cities and counties to form theater, cultural arts and entertainment districts that are currently allowed only in St. Charles County.

• Extends the Division of Tourism Supplemental Revenue Fund expiration date to June 30, 2015.

SS SCS HCS HB 327 – ECONOMIC DEVELOPMENT

• TIF provisions:

• Any municipality in St. Louis County, St. Charles County, or Jefferson County to establish a county TIF commission similar to St. Louis County’s current TIF commission to approve TIF projects in those areas;

• Prohibits any new TIF projects in “greenfields” in St. Louis City or County, or in St. Charles, Jefferson or Franklin counties;

• Prohibits any new TIF in a 100-year flood plain (including the "flood plain" as currently designated by FEMA or as amended in the future by FEMA).

• Hunting Heritage Protection Act;

• Land Assemblage Tax Credit – allows a developer to receive a tax credit equal to 50% of the acquisition costs and 100% of the interest on financing used to assemble large tracts of land of at least 75 acres in certain areas. The credit is capped at $12 million per year with a cumulative cap of $100 million;

• Small Business Investment Tax Credit revisions;

• Disabled person home modification tax credit;

• Civil War Site Preservation Tax Credit;

• Maternity Homes Tax Credit cap increase from $2 million to $3 million;

• Qualified Beef Tax Credit with an annual cap of $10 million and cumulative cap of $30 million;

• Equity Investment Tax Credit of up to $15 million annually;

• Film Production Tax Credit changes and increasing the annual cap from $1.5 to $10.5 million;

• Enhanced Enterprise Zone annual cap raised from $7 million to $25 million and other technical changes to the program;

• Missouri Homestead Preservation Act changes in exemption limit;

• Tax incentives for alternative fuel sellers and consumers;

• Motor fuel tax exemptions for public transit and school buses;

• Sales tax exemptions for common carriers used in intrastate commerce;

• Rebuttable presumption that auto manufacturers meet the 25% recycled raw material requirement of the Electrical Energy Direct Pay exemption, eliminating current requirements that require them to prove entitlement to such exemption every year (all current auto manufacturers already qualify for the exemption) ;

• Sales tax exemption for agricultural biotechnology and plant genomics utility and other purchases and for utilities used in pharmaceutical research and development;

• State and local sales tax exemption for all manufacturing inputs;

• Sales tax exemption for aviation jet fuel used for transoceanic flights;

• Eliminates “nexus” for out-of-state companies (including Internet retailers) that own or control a distribution or data processing center in Missouri, allowing such companies to avoid sales and use tax collection requirements and ensuring there is no income tax liability or franchise tax liability for such out-of-state companies. Currently, such out-of-state companies would be required to collect and remit sales or use taxes on sales made to Missouri customers;

• Vocational School Districts are authorized for several counties;

• New Jobs Training Program expiration is extended for an additional 10 years;

• Family Development Account program changes;

• Transportation Development District changes;

• Establishes a Regional Railroad Authority in all Missouri cities and counties;

• Workforce Investment Board is established and the Missouri Training and Employment Council is eliminated;

• Quality Jobs Program changes and increases in tax credit annual cap from $12 million to $30 million;

• Small Business and Entrepreneurial Growth Act allowing small businesses to retain withholding tax if they are adding a certain number of jobs, do not otherwise qualify for Quality Jobs, and pay at least 85% of the county average wage; and,

• Decriminalization of ticket scalping.

SS HCS HB 741 – REGIONAL ECONOMIC DEVELOPMENT DISTRICTS

• TIF provisions:

• Any municipality in St. Louis County, St. Charles County or Jefferson County to establish a county TIF commission similar to St. Louis County’s current TIF commission and requires municipalities in these counties and Franklin County to receive approval from the county TIF commission for TIF projects after January 1, 2008;

• Requires 2/3 majority vote of a city’s governing body to overturn a TIF commission’s disapproval of a TIF project beginning January 1, 2008;

• Requires the Joint Committee on Tax Policy to study the Missouri Economic Development Code as proposed by the MEDC that would allow voluntary participation by local taxing districts in an incremental financing plan, and to have the results of that study reported to the General Assembly by December 31, 2007 (provisions authorizing the Missouri Economic Development Code were removed from the bill);

• Allows locally owned small businesses in some rural communities to participate in the linked deposit program;

• Disabled person home modification tax credit;

• Makes changes to the Missouri Qualified Biodiesel Producer Incentive Fund program to allow the use of non-Missouri feedstock and other changes;

• Allows local governments to establish Regional Economic Development Districts and to finance projects in such districts with locally imposed sales taxes or TIF and requires reports to be made available to the public annually on the use of district funds;

• Establishes the Rice Certification Committee to control the production, transportation and receipt of rice products in Missouri and to encourage the development of new types of Missouri rice.

SCS HCS HB 795 – LOCAL ECONOMIC DEVELOPMENT

• Allows some cities and counties to impose transient guest taxes;

• Allows additional cities and counties to form theater, cultural arts and entertainment districts that are currently allowed only in St. Charles County.

CCS HCS SS SCS SB 22 – LOCAL GOVERNMENT

• Changes statute authorizing creation of Neighborhood Improvement Districts;

• Authorizes transient guest taxes in certain cities and counties and allows cities with a population of less than 7,500 to transfer 40% of tourism tax revenues to their general revenue fund ;

• Provides for an audit of tax collection and expenditures for tourism purposes in political subdivisions that do not currently have such audit procedures;

• Allows merger of certain Community Improvement Districts and makes other changes to the law authorizing such districts;

• Allows additional cities and counties to form theater, cultural arts and entertainment districts that are currently allowed only in St. Charles County;

• Revises the “Kansas and Missouri Regional Investment District Compact” to become the “Missouri Regional Investment District Compact” if Kansas has not enacted their part of the compact by August 28, 2007;

• Allows the City of Joplin to enact a local sales tax for the benefit of nonprofit museums and nonprofit organizations that operate or promote historic sites;

• Authorizes TIF in flood plains in the City of St. Charles in certain circumstances;

• Requires all affected taxing entities in Boone County to receive notice and PILOTs in industrial development project plans approved after May 15, 2005;

• Provides a sales tax exemption for contractors fulfilling contracts with MoDOT;

• Changes provisions regarding Transportation Development Districts;

CCS HCS SB 30 – TAX PROVISIONS

• Prevents sales taxes levied for Children Services Protection from being diverted to TIF projects after August 28, 2007;

• Authorizes additional transient guest taxes in certain counties and cities;

• Sales tax exemptions for common carriers used in intrastate commerce;

• Sales tax exemption for agricultural biotechnology and plant genomics utility and other purchases and for utilities used in pharmaceutical research and development;

• State sales tax exemption for all manufacturing inputs;

• Sales tax exemption for sales and leases made by cities and counties under a Chapter 100 arrangement, provided such exemption is approved by the Department of Economic Development;

• Family Development Account program changes;

CCS HCS SB 81 – LOCAL ECONOMIC DEVELOPMENT

• Allows some cities and counties to impose transient guest taxes;

• Allows additional cities and counties to form theater, cultural arts and entertainment districts that are currently allowed only in St. Charles County.

SS SCS SB 225 – HUNTING HERITAGE and TIF IN FLOOD PLAINS

• Establishes a protected area in 100 year flood plains of the Missouri and Mississippi rivers, protecting hunting in such areas with some exceptions;

• Prohibits new TIF projects in 100 year flood plains of the Missouri and Mississippi rivers except:

• Projects that improve flood or drainage protection; and

• Renewable fuel production facility projects as long as no other new development results from the project;
• Flood plain is area designated as such by FEMA and any change in the flood plain as determined by FEMA.

CCS SB 233 – LOCAL TAXES

• Prevents sales taxes levied for Children Services Protection from being diverted to TIF projects after August 28, 2007

• Authorizes the City of Gladstone to impose a local transient guest tax;

• Requires disbursement of excess funds in industrial development projects in Boone County to all affected taxing entities.

CCS HCS SB 376 – TOURISM SUPPLEMENTAL REVENUE (Signed 5/3/07)

• Extends the expiration date on the Division of Tourism Supplemental Revenue Fund to June 30, 2015

SS#6 SCS SB 389 – HIGHER EDUCATION (Signed 5/23/07)

• Establishes the Lewis and Clark Discovery Initiative, authorizing the transfer of assets from the Missouri Higher Education Loan Authority (MOHELA) to the Lewis and Clark Discovery Fund for:

• Construction of capital projects at public colleges and universities;

• The Missouri Technology Corporation to assist in the commercialization of technologies developed at these institutions;

• Additional scholarship programs;

• Allows public colleges and universities to increase tuition up to the annual change in the Consumer Price Index and provides that institutions that raise tuition above this limit must remit 5% of its state appropriation to the General Revenue Fund with certain exceptions, subject to final decision by the Coordinating Board of Higher Education.

For more detailed information on these bills, including their current status, please consult the actual text of the bills. You may access the text of the bills at: http://house.mo.gov/jointsearch/