Missouri Senate

Perfected

The act permits the Department of Economic Development to 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 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. Credits can be carried forward for up to three years or sold.

The aggregate cap on the amount of tax credits the department of economic development may authorize for the Small Business Incubators Program is increased from five hundred thousand dollars to two million dollars. 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 which 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 20,000 residents.

Currently, the Department of Economic Development cannot issue more than forty million dollars in tax credits annually under the Quality Jobs Act. The act removes cap on the annual issuance of tax credits. Under current law, tax credits for job retention projects are only authorized through August 30, 2007. The act extends the authorization to August 30, 2013. Under the Quality Jobs Act, a project facility may include separate buildings if they are located within one mile of each other. The act allows a project facility to include separate buildings within the same county. Companies which lease or own facilities that produce electricity derived from qualified renewable energy sources, or which produce fuel for the generation of electricity from qualified renewable energy sources are allowed to participate in the quality jobs program as a technology business project if all other requirements of the program are met. Qualified renewable energy sources include open-looped biomass, close-looped biomass, solar, wind, geothermal, and hydropower but not ethanol distillation or production or biodiesel production.

The act allows community improvement districts (CID) to exist in special business districts within the City of St. Louis. Currently, any CID in St. Louis which is also in a special business district cannot levy a CID sales tax unless special assessments imposed on real property or businesses within the special business district are repealed. Sales by public utilities and providers of communications, cable, or video services will be exempt from the CID sales tax.

The director of the Department of Economic Development is authorized to issue letter rulings regarding the New Markets Tax Credit Program. The letter rulings are binding in a court of law and must be issued within sixty days of a request. The department can refuse to issue the letter ruling for good cause, but must explain the reason for refusal. Letter rulings are closed to the public, however information can be released as long as anything which would identify the applicant or is otherwise protected is redacted. An exemption from state and local sales and use tax is created for all tangible personal property included on the United States munitions list which is sold to or purchased by a foreign government for a governmental purpose. Currently, this exemption is granted by the Department of Revenue through a letter ruling.

The act specifies that the true value in money for property tax 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 authorizes 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.

The provisions of the act regarding the Small Business Incubators Program will become effective upon passage and approval.

JASON ZAMKUS