COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:2603H.01I Bill No.:HB 1416 Subject:Political Subdivisions; Economic Development; Boards, Commissions,
Committees, and Councils; Counties; Cities, Towns, and Villages; Property, Real
and Personal; Public Records, Public Meetings
Type:Original Date:March 25, 2025Bill Summary:This proposal modifies provisions governing Community Improvement
District duties.
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2026FY 2027FY 2028General Revenue*$0 or (Unknown)$0 or (Unknown)$0 or (Unknown)Total Estimated Net
Effect on General
Revenue$0 or (Unknown)$0 or (Unknown)$0 or (Unknown)
*Unknown revenue loss is not expected to meet the $250,000 threshold.
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on Other State
Funds $0$0$0
Numbers within parentheses: () indicate costs or losses. L.R. No. 2603H.01I
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on All Federal
Funds $0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on FTE 000
☐ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Local Government$0 or (Unknown)$0 or (Unknown)$0 or (Unknown) L.R. No. 2603H.01I
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FISCAL ANALYSIS
ASSUMPTION
§§67.1463, 67.1471 & 67.1473 – Community Improvement Districts (CID) Duties
Officials from the Department of Revenue (DOR) assume §67.1473 states that if a community
improvement district be given a compliance grade of less than 80% by the State Auditor Office,
the municipality that allowed the creation of the district is to terminate the district and stop
collection of the tax. DOR notes the property tax collected by these districts is not handled by
DOR. DOR would not have a fiscal impact from that provision. However, should the district
have adopted a sales and use tax then, DOR would need notice from the municipality that the
district was terminated. Upon receipt of that termination notice and notification of the vendors in
the area, DOR would stop collection of the sales and use tax. This type of work is done in
DOR’s normal scope of work and would not require any additional resources.
Oversight notes in §67.1473 that if the district fails to provide notice of an annual meeting or
fails to achieve a compliance grade of 80% per §67.1471 from the Office of the State Auditor,
then the district could be dissolved in part or in full or terminated, but only if notice of a hearing
and a vote by the governing body that the district is located in is held. The language in this
section suggests that the decision to possibly dissolve or terminate is left up to the governing
body of the municipality.
If the governing body of the municipality decides to dissolve in part or terminate the CID in full
and there is a sales tax or other tax attached to the CID, then the municipality will no longer
receive the revenues associated with that CID. Oversight assumes the municipality’s governing
body will take into consideration the pros and cons of this before making a decision. Therefore,
for fiscal note purposes, Oversight will reflect a $0 (no dissolving/termination of CID) or
unknown loss of revenues to the municipality from taxes collected by the CID for this proposal.
Oversight notes that according to DOR’s Financial and Statistical Report as of June 30, 2023,
there were 459 CIDs that had local sales tax of $102,223,981 and local use tax of $4,213,263
which totaled $106,437,245. On average, that is $231,889 ($106,437,245/459) in tax distribution
from each CID. In order for DOR’s 1% administrative fee collections to reach the $250,000
threshold, at least 108 ((108*231,889) * 1%) CIDs or 23.5% of the CIDs would need to be below
the 80% compliance grade and terminated by the municipality. Therefore, Oversight will reflect
a potential loss of revenues to DOR should the taxes that are collected come from a sales or use
tax that is collected by the CID and DOR collects a 1% administrative fee. Oversight will
assume this administrative fee will be less than the $250,000 threshold for fiscal note purposes.
Officials from the Office of Administration - Budget and Planning, the Department of
Economic DevelopmentOffice of the Secretary of State, Kansas City, the Jackson
County Election Board, the Platte County Board of Elections, the St. Louis City Board of
Elections and the St. Louis County Board of Elections each assume the proposal will have no L.R. No. 2603H.01I
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fiscal impact on their respective organizations. Oversight does not have any information to the
contrary. Therefore, Oversight will reflect a zero impact in the fiscal note for these agencies.
Officials from the Office of the State Auditor did not respond to Oversight’s request for fiscal
impact for this proposal.
Oversight assumes that any compliance work done by the Office of the State Auditor regarding
CIDs is in the normal scope of their work and would not require any additional resources. If this
assumption is incorrect, this would alter the fiscal impact as presented in this fiscal note. If
additional information is received by the Office of the State Auditor, Oversight
determine if an updated fiscal note should be prepared and seek approval to publish a new fiscal
note.
Oversight only reflects the responses received from state agencies and political subdivisions;
however, other cities were requested to respond to this proposed legislation but did not. A listing
of political subdivisions included in the Missouri Legislative Information System (MOLIS)
database is available upon request.
FISCAL IMPACT – State GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028GENERAL REVENUERevenue – DOR - loss of
administration fee charged on sales and
use tax revenues from dissolving or
terminating a CID for failing the
provisions of §67.1473
$0 or
(Unknown)
$0 or
(Unknown)
$0 or
(Unknown)
ESTIMATED NET EFFECT ON
GENERAL REVENUE
$0 or
(Unknown)
$0 or
(Unknown)
$0 or
(Unknown) L.R. No. 2603H.01I
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FISCAL IMPACT – Local GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028LOCAL POLITICAL
SUBDIVISIONS
Revenue Loss – loss of revenues from
dissolving or terminating a CID for
failing the provisions of §67.1473
$0 or
(Unknown)
$0 or
(Unknown)
$0 or
(Unknown)
ESTIMATED NET EFFECT ON
LOCAL POLITICAL
SUBDIVISIONS
$0 or
(Unknown)
$0 or
(Unknown)
$0 or
(Unknown)
FISCAL IMPACT – Small Business
Small businesses who collect a sales tax or other tax within a CID from this proposal could be
impacted.
FISCAL DESCRIPTION
This bill requires a community improvement district to provide notice to the governing body of
the municipality in which the district is located of planned meetings and any associated meeting
agendas at least ten calendar days prior to the meeting. If a district calls an emergency meeting it
must provide notice as soon as possible.
The bill adds the list of dates and locations of each meeting of a community improvement district
board to the list of items contained in a report that a district is required to provide to the
municipal clerk, Department of Revenue, the State Auditor, and the Department of Economic
Development. The report must include an affidavit signed by a board member under penalty of
perjury that the information is accurate.
This bill requires the State Auditor to calculate a compliance grade for community improvement
district reporting compliance. The Auditor's office will post the grade on its website no later than
30 days after the reporting deadline.
If a community improvement district fails to achieve a compliance grade of at least 80% it can be
terminated or its board may be dissolved. A terminated district must immediately cease
collecting any tax it is authorized to impose, settle its debts, and return all remaining money.
The governing body of a municipality will not be obligated or liable for any terminated district's
remaining indebtedness, inaction, failure of fiduciary responsibility, fraudulent activity, or other
encumbrance of such terminated district. L.R. No. 2603H.01I
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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
Department of Revenue
Office of Administration - Budget and Planning
Department of Economic Development
Office of the Secretary of State
Kansas City
Jackson County Election Board
Platte County Board of Elections
St. Louis City Board of Elections
St. Louis County Board of Elections
Julie MorffJessica HarrisDirectorAssistant DirectorMarch 25, 2025March 25, 2025