| 1 | 1 | | |
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| 2 | 2 | | EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted |
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| 3 | 3 | | and is intended to be omitted in the law. |
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| 4 | 4 | | FIRST REGULAR SESSION |
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| 5 | 5 | | SENATE BILL NO. 103 |
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| 6 | 6 | | 103RD GENERAL ASSEMBLY |
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| 7 | 7 | | INTRODUCED BY SENATOR BERNSKOETTER. |
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| 8 | 8 | | 1352S.01I KRISTINA MARTIN, Secretary |
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| 9 | 9 | | AN ACT |
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| 10 | 10 | | To repeal section 620.2010, RSMo, and to enact in lieu thereof one new section relating to financial |
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| 11 | 11 | | incentives for business development. |
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| 12 | 12 | | |
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| 13 | 13 | | Be it enacted by the General Assembly of the State of Missouri, as follows: |
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| 14 | 14 | | Section A. Section 620.2010, RSMo, is repealed and one 1 |
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| 15 | 15 | | new section enacted in lieu thereof, to be known as section 2 |
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| 16 | 16 | | 620.2010, to read as follows:3 |
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| 17 | 17 | | 620.2010. 1. In exchange for the consideration 1 |
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| 18 | 18 | | provided by the new tax revenues and other economic stimuli 2 |
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| 19 | 19 | | that will be generated by the new jobs created, a qualified 3 |
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| 20 | 20 | | company may, for a period of five years from the date the 4 |
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| 21 | 21 | | new jobs are created, or for a period of six years from the 5 |
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| 22 | 22 | | date the new jobs are created if the qualified company is an 6 |
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| 23 | 23 | | existing Missouri business, retain an amount equal to the 7 |
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| 24 | 24 | | withholding tax as calculated under subdivision (38) of 8 |
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| 25 | 25 | | section 620.2005 from the new jobs t hat would otherwise be 9 |
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| 26 | 26 | | withheld and remitted by the qualified company under the 10 |
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| 27 | 27 | | provisions of sections 143.191 to 143.265 if: 11 |
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| 28 | 28 | | (1) The qualified company creates ten or more new 12 |
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| 29 | 29 | | jobs, and the average wage of the new payroll equals or 13 |
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| 30 | 30 | | exceeds ninety percent of the county average wage; 14 |
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| 31 | 31 | | (2) The qualified company creates two or more new jobs 15 |
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| 32 | 32 | | at a project facility located in a rural area, the average 16 |
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| 33 | 33 | | wage of the new payroll equals or exceeds ninety percent of 17 |
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| 34 | 34 | | the county average wage, and the qua lified company commits 18 SB 103 2 |
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| 35 | 35 | | to making at least one hundred thousand dollars of new 19 |
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| 36 | 36 | | capital investment at the project facility within two years; 20 |
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| 37 | 37 | | or 21 |
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| 38 | 38 | | (3) The qualified company creates two or more new jobs 22 |
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| 39 | 39 | | at a project facility located within a zone desig nated under 23 |
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| 40 | 40 | | sections 135.950 to 135.963, the average wage of the new 24 |
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| 41 | 41 | | payroll equals or exceeds eighty percent of the county 25 |
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| 42 | 42 | | average wage, and the qualified company commits to making at 26 |
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| 43 | 43 | | least one hundred thousand dollars in new capital investment 27 |
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| 44 | 44 | | at the project facility within two years of approval. 28 |
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| 45 | 45 | | 2. In addition to any benefits available under 29 |
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| 46 | 46 | | subsection 1 of this section, the department may award a 30 |
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| 47 | 47 | | qualified company that satisfies subdivision (1) of 31 |
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| 48 | 48 | | subsection 1 of this section additional ta x credits, issued 32 |
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| 49 | 49 | | each year for a period of five years from the date the new 33 |
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| 50 | 50 | | jobs are created, or for a period of six years from the date 34 |
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| 51 | 51 | | the new jobs are created if the qualified company is an 35 |
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| 52 | 52 | | existing Missouri business, in an amount equal to or less 36 |
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| 53 | 53 | | than six percent of new payroll; provided that in no event 37 |
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| 54 | 54 | | may the total amount of benefits awarded to a qualified 38 |
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| 55 | 55 | | company under this section exceed nine percent of new 39 |
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| 56 | 56 | | payroll in any calendar year. The amount of tax credits 40 |
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| 57 | 57 | | awarded to a qualified co mpany under this subsection shall 41 |
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| 58 | 58 | | not exceed the projected net fiscal benefit to the state, as 42 |
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| 59 | 59 | | determined by the department, and shall not exceed the least 43 |
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| 60 | 60 | | amount necessary to obtain the qualified company's 44 |
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| 61 | 61 | | commitment to initiate the project. In determining the 45 |
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| 62 | 62 | | amount of tax credits to award to a qualified company under 46 |
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| 63 | 63 | | this subsection or a qualified manufacturing company under 47 |
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| 64 | 64 | | subsection 3 of this section, the department shall consider 48 |
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| 65 | 65 | | the following factors: 49 SB 103 3 |
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| 66 | 66 | | (1) The significance of the quali fied company's need 50 |
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| 67 | 67 | | for program benefits; 51 |
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| 68 | 68 | | (2) The amount of projected net fiscal benefit to the 52 |
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| 69 | 69 | | state of the project and the period in which the state would 53 |
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| 70 | 70 | | realize such net fiscal benefit; 54 |
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| 71 | 71 | | (3) The overall size and quality of the proposed 55 |
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| 72 | 72 | | project, including the number of new jobs, new capital 56 |
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| 73 | 73 | | investment, manufacturing capital investment, proposed 57 |
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| 74 | 74 | | wages, growth potential of the qualified company, the 58 |
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| 75 | 75 | | potential multiplier effect of the project, and similar 59 |
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| 76 | 76 | | factors; 60 |
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| 77 | 77 | | (4) The financial stability and creditworthiness of 61 |
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| 78 | 78 | | the qualified company; 62 |
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| 79 | 79 | | (5) The level of economic distress in the area; 63 |
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| 80 | 80 | | (6) An evaluation of the competitiveness of 64 |
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| 81 | 81 | | alternative locations for the project facility, as 65 |
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| 82 | 82 | | applicable; and 66 |
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| 83 | 83 | | (7) The percent of local incentives committed. 67 |
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| 84 | 84 | | 3. (1) The department may award tax credits to a 68 |
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| 85 | 85 | | qualified manufacturing company that makes a manufacturing 69 |
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| 86 | 86 | | capital investment of at least five hundred million dollars 70 |
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| 87 | 87 | | not more than three years following the department 's 71 |
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| 88 | 88 | | approval of a notice of intent and the execution of an 72 |
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| 89 | 89 | | agreement that meets the requirements of subsection 4 of 73 |
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| 90 | 90 | | this section. Such tax credits shall be issued no earlier 74 |
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| 91 | 91 | | than January 1, 2023, and may be issued each year for a 75 |
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| 92 | 92 | | period of five years. A qualified manufacturing company may 76 |
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| 93 | 93 | | qualify for an additional five -year period under this 77 |
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| 94 | 94 | | subsection if it makes an additional manufacturing capital 78 |
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| 95 | 95 | | investment of at least two hundred fifty million dollars 79 |
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| 96 | 96 | | within five years of the department's appr oval of the 80 |
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| 97 | 97 | | original notice of intent. 81 SB 103 4 |
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| 98 | 98 | | (2) The maximum amount of tax credits that any one 82 |
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| 99 | 99 | | qualified manufacturing company may receive under this 83 |
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| 100 | 100 | | subsection shall not exceed five million dollars per 84 |
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| 101 | 101 | | calendar year. The aggregate amount of tax cred its awarded 85 |
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| 102 | 102 | | to all qualified manufacturing companies under this 86 |
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| 103 | 103 | | subsection shall not exceed ten million dollars per calendar 87 |
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| 104 | 104 | | year. 88 |
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| 105 | 105 | | (3) If, at the project facility at any time during the 89 |
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| 106 | 106 | | project period, the qualified manufacturing company 90 |
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| 107 | 107 | | discontinues the manufacturing of the new product, or 91 |
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| 108 | 108 | | discontinues the modification or expansion of an existing 92 |
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| 109 | 109 | | product, and does not replace it with a subsequent or 93 |
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| 110 | 110 | | additional new product or with a modification or expansion 94 |
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| 111 | 111 | | of an existing product, the compan y shall immediately cease 95 |
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| 112 | 112 | | receiving any benefit awarded under this subsection for the 96 |
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| 113 | 113 | | remainder of the project period and shall forfeit all rights 97 |
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| 114 | 114 | | to retain or receive any benefit awarded under this 98 |
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| 115 | 115 | | subsection for the remainder of such period. 99 |
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| 116 | 116 | | (4) Notwithstanding any other provision of law to the 100 |
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| 117 | 117 | | contrary, any qualified manufacturing company that is 101 |
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| 118 | 118 | | awarded benefits under this section shall not simultaneously 102 |
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| 119 | 119 | | receive tax credits or exemptions under sections 100.700 to 103 |
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| 120 | 120 | | 100.850 for the jobs crea ted or retained or capital 104 |
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| 121 | 121 | | improvement that qualified for benefits under this section. 105 |
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| 122 | 122 | | The provisions of subsection 5 of section 285.530 shall not 106 |
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| 123 | 123 | | apply to a qualified manufacturing company that is awarded 107 |
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| 124 | 124 | | benefits under this section. 108 |
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| 125 | 125 | | 4. Upon approval of a notice of intent to receive tax 109 |
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| 126 | 126 | | credits under subsection 2, 3, 6, or 7 of this section, the 110 |
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| 127 | 127 | | department and the qualified company shall enter into a 111 |
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| 128 | 128 | | written agreement covering the applicable project period. 112 |
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| 129 | 129 | | The agreement shall specify, at a minimum: 113 SB 103 5 |
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| 130 | 130 | | (1) The committed number of new jobs, new payroll, and 114 |
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| 131 | 131 | | new capital investment, or the manufacturing capital 115 |
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| 132 | 132 | | investment and committed percentage of retained jobs for 116 |
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| 133 | 133 | | each year during the project period; 117 |
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| 134 | 134 | | (2) The date or time period d uring which the tax 118 |
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| 135 | 135 | | credits shall be issued, which may be immediately or over a 119 |
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| 136 | 136 | | period not to exceed two years from the date of approval of 120 |
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| 137 | 137 | | the notice of intent; 121 |
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| 138 | 138 | | (3) Clawback provisions, as may be required by the 122 |
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| 139 | 139 | | department; 123 |
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| 140 | 140 | | (4) Financial guarantee provisions as may be required 124 |
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| 141 | 141 | | by the department, provided that financial guarantee 125 |
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| 142 | 142 | | provisions shall be required by the department for tax 126 |
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| 143 | 143 | | credits awarded under subsection 7 of this section; and 127 |
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| 144 | 144 | | (5) Any other provisions the department may require. 128 |
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| 145 | 145 | | 5. In lieu of the benefits available under subsections 129 |
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| 146 | 146 | | 1 and 2 of this section, and in exchange for the 130 |
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| 147 | 147 | | consideration provided by the new tax revenues and other 131 |
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| 148 | 148 | | economic stimuli that will be generated by the new jobs 132 |
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| 149 | 149 | | created by the progr am, a qualified company may, for a 133 |
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| 150 | 150 | | period of five years from the date the new jobs are created, 134 |
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| 151 | 151 | | or for a period of six years from the date the new jobs are 135 |
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| 152 | 152 | | created if the qualified company is an existing Missouri 136 |
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| 153 | 153 | | business, retain an amount equal to the withholding tax as 137 |
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| 154 | 154 | | calculated under subdivision (38) of section 620.2005 from 138 |
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| 155 | 155 | | the new jobs that would otherwise be withheld and remitted 139 |
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| 156 | 156 | | by the qualified company under the provisions of sections 140 |
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| 157 | 157 | | 143.191 to 143.265 equal to: 141 |
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| 158 | 158 | | (1) Six percent of new payroll for a period of five 142 |
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| 159 | 159 | | years from the date the required number of new jobs were 143 |
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| 160 | 160 | | created if the qualified company creates one hundred or more 144 |
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| 161 | 161 | | new jobs and the average wage of the new payroll equals or 145 SB 103 6 |
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| 162 | 162 | | exceeds one hundred twenty percent of the co unty average 146 |
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| 163 | 163 | | wage of the county in which the project facility is located; 147 |
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| 164 | 164 | | or 148 |
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| 165 | 165 | | (2) Seven percent of new payroll for a period of five 149 |
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| 166 | 166 | | years from the date the required number of jobs were created 150 |
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| 167 | 167 | | if the qualified company creates one hundred or more n ew 151 |
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| 168 | 168 | | jobs and the average wage of the new payroll equals or 152 |
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| 169 | 169 | | exceeds one hundred forty percent of the county average wage 153 |
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| 170 | 170 | | of the county in which the project facility is located. 154 |
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| 171 | 171 | | The department shall issue a refundable tax credit for any 155 |
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| 172 | 172 | | difference between the amount of benefit allowed under this 156 |
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| 173 | 173 | | subsection and the amount of withholding tax retained by the 157 |
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| 174 | 174 | | company, in the event the withholding tax is not sufficient 158 |
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| 175 | 175 | | to provide the entire amount of benefit due to the qualified 159 |
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| 176 | 176 | | company under this subsectio n. 160 |
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| 177 | 177 | | 6. In addition to the benefits available under 161 |
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| 178 | 178 | | subsection 5 of this section, the department may award a 162 |
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| 179 | 179 | | qualified company that satisfies the provisions of 163 |
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| 180 | 180 | | subsection 5 of this section additional tax credits, issued 164 |
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| 181 | 181 | | each year for a period of fi ve years from the date the new 165 |
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| 182 | 182 | | jobs are created, or for a period of six years from the date 166 |
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| 183 | 183 | | the new jobs are created if the qualified company is an 167 |
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| 184 | 184 | | existing Missouri business, in an amount equal to or less 168 |
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| 185 | 185 | | than three percent of new payroll; provided th at in no event 169 |
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| 186 | 186 | | may the total amount of benefits awarded to a qualified 170 |
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| 187 | 187 | | company under this section exceed nine percent of new 171 |
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| 188 | 188 | | payroll in any calendar year. The amount of tax credits 172 |
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| 189 | 189 | | awarded to a qualified company under this subsection shall 173 |
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| 190 | 190 | | not exceed the projected net fiscal benefit to the state, as 174 |
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| 191 | 191 | | determined by the department, and shall not exceed the least 175 |
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| 192 | 192 | | amount necessary to obtain the qualified company's 176 SB 103 7 |
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| 193 | 193 | | commitment to initiate the project. In determining the 177 |
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| 194 | 194 | | amount of tax credits to award to a qualified company under 178 |
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| 195 | 195 | | this subsection, the department shall consider the factors 179 |
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| 196 | 196 | | provided under subsection 2 of this section. 180 |
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| 197 | 197 | | 7. In lieu of the benefits available under subsections 181 |
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| 198 | 198 | | 1, 2, 5, and 6 of this section, and in exchange for the 182 |
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| 199 | 199 | | consideration provided by the new tax revenues and other 183 |
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| 200 | 200 | | economic stimuli that will be generated by the new jobs and 184 |
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| 201 | 201 | | new capital investment created by the program, the 185 |
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| 202 | 202 | | department may award a qualified company that satisfies the 186 |
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| 203 | 203 | | provisions of subdivision (1 ) of subsection 1 of this 187 |
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| 204 | 204 | | section tax credits, issued within one year following the 188 |
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| 205 | 205 | | qualified company's acceptance of the department's proposal 189 |
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| 206 | 206 | | for benefits, in an amount equal to or less than nine 190 |
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| 207 | 207 | | percent of new payroll. The amount of tax credits awa rded 191 |
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| 208 | 208 | | to a qualified company under this subsection shall not 192 |
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| 209 | 209 | | exceed the projected net fiscal benefit to the state, as 193 |
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| 210 | 210 | | determined by the department, and shall not exceed the least 194 |
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| 211 | 211 | | amount necessary to obtain the qualified company's 195 |
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| 212 | 212 | | commitment to initiate the project. In determining the 196 |
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| 213 | 213 | | amount of tax credits to award to a qualified company under 197 |
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| 214 | 214 | | this subsection, the department shall consider the factors 198 |
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| 215 | 215 | | provided under subsection 2 of this section and the 199 |
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| 216 | 216 | | qualified company's commitment to new capital i nvestment and 200 |
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| 217 | 217 | | new job creation within the state for a period of not less 201 |
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| 218 | 218 | | than ten years. For the purposes of this subsection, each 202 |
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| 219 | 219 | | qualified company shall have an average wage of the new 203 |
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| 220 | 220 | | payroll that equals or exceeds one hundred percent of the 204 |
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| 221 | 221 | | county average wage. Notwithstanding the provisions of 205 |
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| 222 | 222 | | section 620.2020 to the contrary, this subsection shall 206 |
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| 223 | 223 | | expire on June 30, [2025] 2031. 207 SB 103 8 |
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| 224 | 224 | | 8. No benefits shall be available under this section 208 |
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| 225 | 225 | | for any qualified company that has performed significan t, 209 |
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| 226 | 226 | | project-specific site work at the project facility, 210 |
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| 227 | 227 | | purchased machinery or equipment related to the project, or 211 |
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| 228 | 228 | | has publicly announced its intention to make new capital 212 |
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| 229 | 229 | | investment or manufacturing capital investment at the 213 |
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| 230 | 230 | | project facility prior to receipt of a proposal for benefits 214 |
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| 231 | 231 | | under this section or approval of its notice of intent, 215 |
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| 232 | 232 | | whichever occurs first. 216 |
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| 233 | 233 | | 9. In lieu of any other benefits under this chapter, 217 |
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| 234 | 234 | | the department of economic development may award a tax 218 |
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| 235 | 235 | | credit to an industria l development authority for a 219 |
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| 236 | 236 | | qualified military project in an amount equal to the 220 |
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| 237 | 237 | | estimated withholding taxes associated with the part -time 221 |
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| 238 | 238 | | and full-time civilian and military new jobs located at the 222 |
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| 239 | 239 | | facility and directly impacted by the project. The amount 223 |
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| 240 | 240 | | of the tax credit shall be calculated by multiplying: 224 |
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| 241 | 241 | | (1) The average percentage of tax withheld, as 225 |
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| 242 | 242 | | provided by the department of revenue to the department of 226 |
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| 243 | 243 | | economic development; 227 |
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| 244 | 244 | | (2) The average salaries of the jobs directly creat ed 228 |
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| 245 | 245 | | by the qualified military project; and 229 |
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| 246 | 246 | | (3) The number of jobs directly created by the 230 |
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| 247 | 247 | | qualified military project. 231 |
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| 248 | 248 | | If the amount of the tax credit represents the least amount 232 |
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| 249 | 249 | | necessary to accomplish the qualified military project, the 233 |
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| 250 | 250 | | tax credits may be issued, but no tax credits shall be 234 |
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| 251 | 251 | | issued for a term longer than fifteen years. No qualified 235 |
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| 252 | 252 | | military project shall be eligible for tax credits under 236 |
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| 253 | 253 | | this subsection unless the department of economic 237 SB 103 9 |
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| 254 | 254 | | development determines the qualified mil itary project shall 238 |
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| 255 | 255 | | achieve a net positive fiscal impact to the state. 239 |
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| 256 | 256 | | |
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