HB2170--RURALECONOMICDEVELOPMENT(Gregory)
COMMITTEEOFORIGIN:StandingCommitteeonRuralCommunity
Development
Thisbillestablishesthe"MissouriRuralAccesstoCapitalAct".
Thisbillallowsinvestorstomakecapitalinvestmentsina"rural
fund",asdefinedinthebill.Suchinvestorswillbealloweda
taxcreditforaperiodofsixyearsbeginningwiththeyearthe
investormadeacapitalinvestment. Thetaxcreditshallbeequal
toapercentageofthecapitalinvestment. Thepercentageshallbe
zeroforthefirsttwoyears,and15%forthesubsequentfour
years.Taxcreditsshallnotberefundable,butmaybecarried
forwardtoanyofthefivesubsequenttaxyears.Nomorethan$16
millionintaxcreditsshallbeauthorizedinagivencalendar
year.
Aruralfundwishingtoacceptinvestmentsascapitalinvestments
mustapplytotheDepartmentofEconomicDevelopment. The
applicationshallinclude:
(1)Theamountofcapitalinvestmentrequested;
(2)Acopyoftheapplicant'slicenseasaruralbusinessorsmall
businessinvestmentcompany;
(3)Evidencethattheapplicanthasmadeatleast$100millionin
investmentsinnonpubliccompanieslocatedincountiesthroughout
theUnitedStateswithapopulationlessthan50,000;
(4)Evidencethattheapplicanthasmadeatleast$30millionin
investmentsinnonpubliccompanieslocatedinMissouri;
(5)Abusinessplanthatincludesarevenueimpactstatement
projectingStateandlocaltaxrevenuetobegeneratedbythe
applicant'sproposedqualifiedinvestments;and
(6)A$5,000nonrefundableapplicationfee.
TheDepartmentshallgrantordenyanapplicationwithin60daysof
receipt. TheDepartmentmustdenyanapplicationif:
(1)Theapplicationisincompleteorinsufficient;
(2)Therevenueimpactassessmentdoesnotdemonstratethatthe
businessplanwillresultinapositiveeconomicimpactonthe
Stateovera10yearperiod;or (3)TheDepartmenthasalreadyapprovedthemaximumamountof
capitalinvestmentauthority.
Ruralfundsmustusecapitalinvestmentsmadebyinvestorstomake
qualifiedinvestmentsineligiblebusinesses. Aneligiblebusiness
shall:
(1)Havefewerthan250employees;
(2)HaveaprincipalbusinessoperationinMissouri;
(3)Beengagedincertainindustries,asspecifiedinthebill;
and
(4)Notknowinglyemployanyindividualwhoisunlawfullypresent
inthiscountry,andislocatedorhascommittedtolocateina
ruralarea.
TheDepartmentmayrecapturetaxcreditsinthefollowingways:
(1)Iftheruralfunddoesnotinvest60%ofitscapital
investmentauthorityinqualifiedinvestmentswithintwoyearsof
the"creditallowancedate",asdefinedinthebill,and100%of
itscapitalinvestmentauthoritywithinthreeyears,providedthat
atleast70%ofqualifiedinvestmentsshallbemadeineligible
businesseslocatedinruralareasoreligiblebusinessesthatare
alsoagribusinesses; nomorethan30%ofaqualifiedinvestment
mustbemadeineligiblebusinesseslocatedoutsideofarural
area;
(2)Iftheruralfundfailstomaintainqualifiedinvestments
equalto90%ofitscapitalinvestmentauthorityinyearsthree
throughsix,asdescribedinthebill,with70%ofsuchinvestments
ineligiblebusinesseslocatedinruralareasoreligible
businessesthatarealsoagribusinesses, providedthatnomorethan
30%ofaqualifiedinvestmentismadeineligiblebusinesses
locatedoutsideofaruralarea.Foreachyeartheruralfund
failstomaintainsuchinvestments,theDepartmentmayrecapture
creditsequaltothepercentagedifferencebetween90%ofarural
fund'scapitalinvestmentauthorityandtheactualamountof
qualifiedinvestmentsmaintainedforsuchyear,asspecifiedinthe
bill;
(3)Ifpriortoexitingtheprogramor30daysafterthesixth
year,whicheverisearliest,theruralfundmakesadistributionor
paymentthatresultsinthefundhavinglessthan100%ofits
capitalinvestmentauthorityinvestedinqualifiedinvestments;or
(4)Iftheruralfundviolatesprovisionsofthebill. Aneligiblebusinessthatreceivesaqualifiedinvestmentshall
not:
(1)Ownorhavetherighttoacquireanownershipinterestina
ruralfund;or
(2)Loantoorinvestinaruralfundwheretheproceedsofsucha
loanorinvestmentsareusedtofundorrefinancethepurchaseofa
capitalinvestment.
RuralfundsshallsubmitannualreportstotheDepartment,as
specifiedinthebill,andincludethefollowinginformation:
(1)Thenameandlocationofeacheligiblebusinessreceivinga
qualifiedinvestment;
(2)Bankstatementsofsuchruralfundevidencingeachqualified
investment;
(3)Acopyofthewrittenopinion,asspecifiedinthebill,or
evidencethatsuchbusinesswasaneligiblebusinessatthetimeof
suchqualifiedinvestment;and
(4)Thetotalnumberofnewjobs,maintainedjobs,newpayroll,
maintainedpayroll,newrevenue,andmaintainedrevenuebyeach
eligiblebusinessreceivingaqualifiedinvestmentfromarural
fund;
(5)ArevenueimpactassessmentprojectingStateandlocaltax
revenuegeneratedandprojectedtobegenerated;and
(6)AnyotherinformationrequiredbytheDepartment,asspecified
inthebill.
Atanytimeafterthesixthanniversaryofthecapitalinvestment,
aruralfundmayapplytotheDepartmenttoexittheprogram. The
Departmentmustrespondtosuchapplicationwithin30days.Atthe
timearuralfundexitstheprogram,itshallberequiredtomakea
distributiontotheState,nottoexceed10%oftheamountoftax
creditsreceived,iftheamountofStateandlocaltaxbenefits
generatedbytheruralfund'squalifiedinvestmentsarelessthan
theamountoftaxcreditsdistributedtotheruralfund.
TheprogramexpiresAugust28,2030,andtheprovisionssunset
September1,2031.