EXPLANATION-Matter enclosed in bold-faced brackets [thus] in this bill is not enacted
and is intended to be omitted in the law.
FIRST REGULAR SESSION
SENATE BILL NO. 126
103RD GENERAL ASSEMBLY
INTRODUCED BY SENATOR ROBERTS.
0486S.01I KRISTINA MARTIN, Secretary
AN ACT
To repeal sections 32.115 and 135.460, RSMo, and to enact in lieu thereof two new sections
relating to benevolent tax credits.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Sections 32.115 and 135.460, RSMo, are repealed 1
and two new sections enacted in lieu thereof, to be known as 2
sections 32.115 and 135.460, to read as follo ws:3
32.115. 1. The department of revenue shall grant a 1
tax credit, to be applied in the following order until used, 2
against: 3
(1) The annual tax on gross premium receipts of 4
insurance companies in chapter 148; 5
(2) The tax on banks det ermined pursuant to 6
subdivision (2) of subsection 2 of section 148.030; 7
(3) The tax on banks determined in subdivision (1) of 8
subsection 2 of section 148.030; 9
(4) The tax on other financial institutions in chapter 10
148; 11
(5) The corporation franchise tax in chapter 147; 12
(6) The state income tax in chapter 143; and 13
(7) The annual tax on gross receipts of express 14
companies in chapter 153. 15
2. For proposals approved pursuant to section 32.110: 16
(1) The amount of the ta x credit shall not exceed 17
[fifty] seventy percent of the total amount contributed 18 SB 126 2
during the taxable year by the business firm or, in the case 19
of a financial institution, where applicable, during the 20
relevant income period in programs approved pursuant to 21
section 32.110; 22
(2) Except as provided in subsection 2 or 5 of this 23
section, a tax credit of up to seventy percent may be 24
allowed for contributions to programs where activities fall 25
within the scope of special program priorities as defined 26
with the approval of the governor in regulations promulgated 27
by the director of the department of economic development; 28
(3) Except as provided in subsection 2 or 5 of this 29
section, the tax credit allowed for contributions to 30
programs located in any community shall be equal to seventy 31
percent of the total amount contributed where such community 32
is a city, town or village which has fifteen thousand or 33
less inhabitants as of the last decennial census and is 34
located in a county which is either locat ed in: 35
(a) An area that is not part of a standard 36
metropolitan statistical area; 37
(b) A standard metropolitan statistical area but such 38
county has only one city, town or village which has more 39
than fifteen thousand inhabitants; or 40
(c) A standard metropolitan statistical area and a 41
substantial number of persons in such county derive their 42
income from agriculture. 43
Such community may also be in an unincorporated area in such 44
county as provided in subdivision (1), (2) or (3) of this 45
subsection. Except in no case shall the total economic 46
benefit of the combined federal and state tax savings to the 47
taxpayer exceed the amount contributed by the taxpayer 48
during the tax year; 49 SB 126 3
(4) Such tax credit allocation, equal to seventy 50
percent of the total amount contributed, shall not exceed 51
four million dollars in fiscal year 1999 and six million 52
dollars in fiscal year 2000 and any subsequent fiscal year. 53
When the maximum dollar limit on the seventy percent tax 54
credit allocation is comm itted, the tax credit allocation 55
for such programs shall then be equal to fifty percent 56
credit of the total amount contributed. Regulations 57
establishing special program priorities are to be 58
promulgated during the first month of each fiscal year and 59
at such times during the year as the public interest 60
dictates. Such credit shall not exceed two hundred and 61
fifty thousand dollars annually except as provided in 62
subdivision (5) of this subsection. No tax credit shall be 63
approved for any bank, bank an d trust company, insurance 64
company, trust company, national bank, savings association, 65
or building and loan association for activities that are a 66
part of its normal course of business. Any tax credit not 67
used in the period the contribution was made ma y be carried 68
over the next five succeeding calendar or fiscal years until 69
the full credit has been claimed. Except as otherwise 70
provided for proposals approved pursuant to section 32.111, 71
32.112 or 32.117, in no event shall the total amount of all 72
other tax credits allowed pursuant to sections 32.100 to 73
32.125 exceed thirty -two million dollars in any one fiscal 74
year, of which six million shall be credits allowed pursuant 75
to section 135.460. If six million dollars in credits are 76
not approved, then the remaining credits may be used for 77
programs approved pursuant to sections 32.100 to 32.125; 78
(5) The credit may exceed two hundred fifty thousand 79
dollars annually and shall not be limited if community 80
services, crime prevention, education, job training, 81 SB 126 4
physical revitalization or economic development, as defined 82
by section 32.105, is rendered in an area defined by federal 83
or state law as an impoverished, economically distressed, or 84
blighted area or as a neighborhood experiencing problems 85
endangering its existence as a viable and stable 86
neighborhood, or if the community services, crime 87
prevention, education, job training, physical revitalization 88
or economic development is limited to impoverished persons. 89
3. For proposals approved pur suant to section 32.111: 90
(1) The amount of the tax credit shall not exceed 91
[fifty-five] seventy percent of the total amount invested in 92
affordable housing assistance activities or market rate 93
housing in distressed communities as defined in section 94
135.530 by a business firm. Whenever such investment is 95
made in the form of an equity investment or a loan, as 96
opposed to a donation alone, tax credits may be claimed only 97
where the loan or equity investment is accompanied by a 98
donation which is eli gible for federal income tax charitable 99
deduction, and where the total value of the tax credits 100
herein plus the value of the federal income tax charitable 101
deduction is less than or equal to the value of the 102
donation. Any tax credit not used in the per iod for which 103
the credit was approved may be carried over the next ten 104
succeeding calendar or fiscal years until the full credit 105
has been allowed. If the affordable housing units or market 106
rate housing units in distressed communities for which a tax 107
is claimed are within a larger structure, parts of which are 108
not the subject of a tax credit claim, then expenditures 109
applicable to the entire structure shall be reduced on a 110
prorated basis in proportion to the ratio of the number of 111
square feet devoted to the affordable housing units or 112
market rate housing units in distressed communities, for 113 SB 126 5
purposes of determining the amount of the tax credit. The 114
total amount of tax credit granted for programs approved 115
pursuant to section 32.111 for the fiscal year beginning 116
July 1, 1991, shall not exceed two million dollars, to be 117
increased by no more than two million dollars each 118
succeeding fiscal year, until the total tax credits that may 119
be approved reaches ten million dollars in any fiscal year; 120
(2) For any year during the compliance period 121
indicated in the land use restriction agreement, the owner 122
of the affordable housing rental units for which a credit is 123
being claimed shall certify to the commission that all 124
tenants renting claimed units ar e income eligible for 125
affordable housing units and that the rentals for each 126
claimed unit are in compliance with the provisions of 127
sections 32.100 to 32.125. The commission is authorized, in 128
its discretion, to audit the records and accounts of the 129
owner to verify such certification; 130
(3) In the case of owner -occupied affordable housing 131
units, the qualifying owner occupant shall, before the end 132
of the first year in which credits are claimed, certify to 133
the commission that the occupant is income eligible during 134
the preceding two years, and at the time of the initial 135
purchase contract, but not thereafter. The qualifying owner 136
occupant shall further certify to the commission, before the 137
end of the first year in which credits are claimed, that 138
during the compliance period indicated in the land use 139
restriction agreement, the cost of the affordable housing 140
unit to the occupant for the claimed unit can reasonably be 141
projected to be in compliance with the provisions of 142
sections 32.100 to 32.125 . Any succeeding owner occupant 143
acquiring the affordable housing unit during the compliance 144 SB 126 6
period indicated in the land use restriction agreement shall 145
make the same certification; 146
(4) If at any time during the compliance period the 147
commission determines a project for which a proposal has 148
been approved is not in compliance with the applicable 149
provisions of sections 32.100 to 32.125 or rules promulgated 150
therefor, the commission may within one hundred fifty days 151
of notice to the owner either se ek injunctive enforcement 152
action against the owner, or seek legal damages against the 153
owner representing the value of the tax credits, or 154
foreclose on the lien in the land use restriction agreement, 155
selling the project at a public sale, and paying to t he 156
owner the proceeds of the sale, less the costs of the sale 157
and less the value of all tax credits allowed herein. The 158
commission shall remit to the director of revenue the 159
portion of the legal damages collected or the sale proceeds 160
representing the value of the tax credits. However, except 161
in the event of intentional fraud by the taxpayer, the 162
proposal's certificate of eligibility for tax credits shall 163
not be revoked. 164
4. For proposals approved pursuant to section 32.112, 165
the amount of the tax credit shall not exceed [fifty-five] 166
seventy percent of the total amount contributed to a 167
neighborhood organization by business firms. Any tax credit 168
not used in the period for which the credit was approved may 169
be carried over the next ten succee ding calendar or fiscal 170
years until the full credit has been allowed. The total 171
amount of tax credit granted for programs approved pursuant 172
to section 32.112 shall not exceed one million dollars for 173
each fiscal year. 174
5. The total amount of tax c redits used for market 175
rate housing in distressed communities pursuant to sections 176 SB 126 7
32.100 to 32.125 shall not exceed thirty percent of the 177
total amount of all tax credits authorized pursuant to 178
sections 32.111 and 32.112. 179
135.460. 1. This section and sections 620.1100 and 1
620.1103 shall be known and may be cited as the "Youth 2
Opportunities and Violence Prevention Act". 3
2. As used in this section, the term "taxpayer" shall 4
include corporations as defined in section 143.441 o r 5
143.471, any charitable organization which is exempt from 6
federal income tax and whose Missouri unrelated business 7
taxable income, if any, would be subject to the state income 8
tax imposed under chapter 143, and individuals, individual 9
proprietorships and partnerships. 10
3. A taxpayer shall be allowed a tax credit against 11
the tax otherwise due pursuant to chapter 143, excluding 12
withholding tax imposed by sections 143.191 to 143.265, 13
chapter 147, chapter 148, or chapter 153 in an amount equal 14
to thirty percent for property contributions and [fifty] 15
seventy percent for monetary contributions of the amount 16
such taxpayer contributed to the programs described in 17
subsection 5 of this section, not to exceed two hundred 18
thousand dollars per taxable year, per taxpayer; except as 19
otherwise provided in subdivision (5) of subsection 5 of 20
this section. The department of economic development shall 21
prescribe the method for claiming the tax credits allowed in 22
this section. No rule or portion of a rule promulgated 23
under the authority of this section shall become effective 24
unless it has been promulgated pursuant to the provisions of 25
chapter 536. All rulemaking authority delegated prior to 26
June 27, 1997, is of no force and effect and repealed; 27
however, nothing in this section shall be interpreted to 28
repeal or affect the validity of any rule filed or adopted 29 SB 126 8
prior to June 27, 1997, if such rule complied with the 30
provisions of chapter 536. The provisions of this section 31
and chapter 536 are nonseve rable and if any of the powers 32
vested with the general assembly pursuant to chapter 536, 33
including the ability to review, to delay the effective 34
date, or to disapprove and annul a rule or portion of a 35
rule, are subsequently held unconstitutional, then the 36
purported grant of rulemaking authority and any rule so 37
proposed and contained in the order of rulemaking shall be 38
invalid and void. 39
4. The tax credits allowed by this section shall be 40
claimed by the taxpayer to offset the taxes that become d ue 41
in the taxpayer's tax period in which the contribution was 42
made. Any tax credit not used in such tax period may be 43
carried over the next five succeeding tax periods. 44
5. The tax credit allowed by this section may only be 45
claimed for monetary o r property contributions to public or 46
private programs authorized to participate pursuant to this 47
section by the department of economic development and may be 48
claimed for the development, establishment, implementation, 49
operation, and expansion of the f ollowing activities and 50
programs: 51
(1) An adopt-a-school program. Components of the 52
adopt-a-school program shall include donations for school 53
activities, seminars, and functions; school -business 54
employment programs; and the donation of property a nd 55
equipment of the corporation to the school; 56
(2) Expansion of programs to encourage school dropouts 57
to reenter and complete high school or to complete a 58
graduate equivalency degree program; 59
(3) Employment programs. Such programs shall 60
initially, but not exclusively, target unemployed youth 61 SB 126 9
living in poverty and youth living in areas with a high 62
incidence of crime; 63
(4) New or existing youth clubs or associations; 64
(5) Employment/internship/apprenticeship programs in 65
business or trades for persons less than twenty years of 66
age, in which case the tax credit claimed pursuant to this 67
section shall be equal to one -half of the amount paid to the 68
intern or apprentice in that tax year, except that such 69
credit shall not exceed ten thousand dollars per person; 70
(6) Mentor and role model programs; 71
(7) Drug and alcohol abuse prevention training 72
programs for youth; 73
(8) Donation of property or equipment of the taxpayer 74
to schools, including schools which primarily educ ate 75
children who have been expelled from other schools, or 76
donation of the same to municipalities, or not -for-profit 77
corporations or other not -for-profit organizations which 78
offer programs dedicated to youth violence prevention as 79
authorized by the de partment; 80
(9) Not-for-profit, private or public youth activity 81
centers; 82
(10) Nonviolent conflict resolution and mediation 83
programs; 84
(11) Youth outreach and counseling programs. 85
6. Any program authorized in subsection 5 of this 86
section shall, at least annually, submit a report to the 87
department of economic development outlining the purpose and 88
objectives of such program, the number of youth served, the 89
specific activities provided pursuant to such program, the 90
duration of such program and recorded youth attendance where 91
applicable. 92 SB 126 10
7. The department of economic development shall, at 93
least annually submit a report to the Missouri general 94
assembly listing the organizations participating, services 95
offered and the number o f youth served as the result of the 96
implementation of this section. 97
8. The tax credit allowed by this section shall apply 98
to all taxable years beginning after December 31, 1995. 99
9. For the purposes of the credits described in this 100
section, in the case of a corporation described in section 101
143.471, partnership, limited liability company described in 102
section 347.015, cooperative, marketing enterprise, or 103
partnership, in computing Missouri's tax liability, such 104
credits shall be allowed to th e following: 105
(1) The shareholders of the corporation described in 106
section 143.471; 107
(2) The partners of the partnership; 108
(3) The members of the limited liability company; and 109
(4) Individual members of the cooperative or marketing 110
enterprise. 111
Such credits shall be apportioned to the entities described 112
in subdivisions (1) and (2) of this subsection in proportion 113
to their share of ownership on the last day of the 114
taxpayer's tax period. 115