COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. NO.: 4658-01
BILL NO.: SB 1074
SUBJECT: Business and Commerce; Corporations; Economic Development Department; Taxation and Revenue - General.
TYPE: Original
DATE: March 13, 2000
FISCAL SUMMARY
| FUND AFFECTED | FY 2001 | FY 2002 | FY 2003 |
| General Revenue | $0 | (unknown) | (unknown) |
| Total Estimated
Net Effect on All State Funds * |
$0 | (Unknown) | (Unknown) |
* Could possibly exceed $100,000
| FUND AFFECTED | FY 2001 | FY 2002 | FY 2003 |
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2001 | FY 2002 | FY 2003 |
| Local Government | $0 | (Unknown) | (Unknown) |
Numbers within parentheses: ( ) indicate costs or losses
This fiscal note contains 4 pages.
ASSUMPTION
Officials from the Department of Economic Development (DED) did not respond to our request for fiscal impact.
Officials from the Department of Social Services (DOS) assume this proposal is not intended to relate to individual benefit programs such as Food Stamps, cash and medical benefits administered by the Division of Family Services. It is also assumed that existing contracts with service providers would include the data needed by the DED to produce the required annual report. Based upon these assumptions, no fiscal impact is assumed by the DOS.
The DOS states that if the Department of Economic Development issues rules which require the submission of information to them relating to individual benefit programs or which exceed current data maintained by the DOS, cost would be incurred.
Officials from the Department of Natural Resources (DNR) state the Department of Economic Development would be required to prepare an agreement form, as well as establish the standard information that must be included in the report that would be submitted by each department impacted by this proposed legislation.
The DNR states that since the agreement form and the reporting standards have not yet been established, the DNR is unable to determine the amount of increased tracking and reporting requirements that would result from this proposal. The DNR assumes that additional resources may have to be requested if the tracking and reporting requirements are more extensive than what is currently being done.
Officials from the Missouri Department of Conservation (MDC) state they are unsure if the proposed legislation would apply to landowner incentive payments paid to individual landowners. If the legislation applies, the MDC assumes there would be significant impact to their agency because of the agreement and reporting requirements.
Officials from the Department of Elementary and Secondary Education and the Department of Revenue assume this proposal will not fiscally impact their respective agencies.
Officials from the Office of Secretary of State (SOS) assume there would be costs due to additional publishing duties related to the Department of Economic Development's authority to promulgate rules, regulations, and forms. SOS estimates the division could require approximately 16 new pages of regulations in the Code of State Regulations at a cost of $26.50 per page, and 24 new pages in the Missouri Register at a cost of $22.50 per page. Costs due to
ASSUMPTION (continued)
this proposal are estimated to be $964, the actual fiscal impact would be dependent upon the actual rule-making authority and may be more or less. Financial impact in subsequent fiscal
years would depend entirely on the number, length, and frequency of the rules filed, amended, rescinded, or withdrawn. SOS does not anticipate the need for additional staff as a result of this proposal; however, the enactment of more than one similar proposal may, in the aggregate,
necessitate additional staff.
Oversight assumes the SOS could absorb the costs of printing and distributing regulations related to this proposal. If multiple bills pass which require the printing and distribution of regulations at substantial costs, the SOS could request funding through the appropriation process. Any decisions to raise fees to defray costs would likely be made in subsequent fiscal years.
Oversight assumes this proposal would affect the Department of Economic Development and all state and local agencies that use economic incentives. Oversight assumes the additional reporting requirements, project tracking, goal monitoring and coordination would result in an unknown amount of expense in fiscal years 2002 and 2003, estimated to exceed $100,000.
FISCAL IMPACT - State Government FY 2001 FY 2002 FY 2003
(10 Mo.)
GENERAL REVENUE FUND
Costs - Expenses to implement the
accountability provisions $0 (unknown) (unknown)
FISCAL IMPACT - Local Government FY 2001 FY 2002 FY 2003
(10 Mo.)
LOCAL POLITICAL SUBDIVISIONS
Costs - Expenses to implement the
accountability provisions $0 (unknown) (unknown)
FISCAL IMPACT - Small Business
A fiscal impact to small businesses would be expected as a result of this proposal if the record-keeping and reporting standards regarding their received economic incentive are increased.
DESCRIPTION
This proposal establishes a standardized agreement and disclosure form required from a person or entity receiving any kind of financial "economic incentive" from a state or local government. The form will include detailed information of all benefits received and obligations required of the recipient, including the obligations of the recipient to return such benefits in the event the recipient is unable to meet the goals or performance standards set forth in the agreement.
A recipient of an "economic incentive" violating any of the terms of the incentive agreement must repay the benefit, plus interest and any penalty imposed in the agreement, and may not be eligible to receive any economic incentives for a period of five years.
All incentive providers are required to monitor the progress of the economic incentive programs offered and make an annual report on the status of such programs. The reports shall be submitted to the Department of Economic Development. The Department will compile and summarize the information into an annual report.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Secretary of State's Office
Department of Revenue
Department of Social Services
Department of Natural Resources
Department of Elementary and Secondary Education
Missouri Department of Conservation
NOT RESPONDING: Department of Economic Development
Jeanne Jarrett, CPA
Director
March 13, 2000