HCS HB 995 -- REGIONAL ECONOMIC DEVELOPMENT INITIATIVE

SPONSOR:  Richard (Hobbs)

COMMITTEE ACTION:  Voted "do pass" by the Special Committee on
Job Creation and Economic Development by a vote of 11 to 0.

This substitute establishes a Regional Economic Development
Initiative to promote individual and business investments in
economic development within a region through contributions to
regional economic development organizations.  A regional economic
development organization is any legally formed and locally
recognized nonprofit organization representing multiple cities or
counties with the goal of promoting economic growth for its
respective area.

Beginning January 1, 2008, taxpayers will be eligible to receive
a tax credit equal to 50% of any amount contributed to a regional
economic development organization if the organization's plan has
been approved by the Department of Economic Development.  In
order to receive the tax credit, contributions must be made
during the department-approved fundraising time period.

No more than $12 million of tax credits can be authorized
annually and no more than $36 million for the life of the
program.  The tax credit can be used to offset a taxpayer's
income tax; corporate franchise tax; financial institutions tax;
or bridge, express, and public utilities tax.  The tax can be
carried forward for five years or sold.

The organization is required to submit an application to the
department for tax credit authorization.  The requirements of the
application, eligible activities, and considerations the
department must take into account when reviewing applications are
specified.  The organization must submit quarterly reports
detailing its expenditures and the progress of its project.
Within six months of the end of the project, the organization
must report its results and submit an audit to the department.
If the funds have not been expended in accordance with the
approved application or if the project has not been completed,
the organization must repay the department an amount equal to the
tax credits issued.

The provisions of the substitute will expire three years from the
effective date.

FISCAL NOTE:  Estimated Cost on General Revenue Fund of $59,632
in FY 2008, $90,700 to 12,090,700 in FY 2009, and $110,392 to
12,110,392 in FY 2010.  No impact on Other State Funds in
FY 2008, FY 2009, and FY 2010.

PROPONENTS:  Supporters say that the bill creates a pool of tax
credits for building infrastructure and job training.  Rural
entities often have difficulty financing the new infrastructure
necessary for new businesses; and in many places, the workforce
needs to be trained for new types of manufacturing and technology
jobs.  The flexibility the bill provides is important, especially
to smaller communities which have different needs and fewer
resources than large urban areas.

Testifying for the bill were Representative Hobbs; and Missouri
Economic Development Council.

OPPONENTS:  There was no opposition voiced to the committee.

Missouri House of Representatives
94th General Assembly, 1st Regular Session
Last Updated July 25, 2007 at 11:21 am