Megaprojects, tax credit authorized, eligibility--departmentduties--binding contract required, when--issuance of credits,procedure.
135.968. 1. A taxpayer who establishes a megaproject, approved bythe department, within an enhanced enterprise zone shall, in exchange forthe consideration provided by new tax revenues and other economic stimulithat will be generated from the new jobs created by the megaproject, beallowed an income tax credit equal to the percentage of actual new annualpayroll of the taxpayer attributable to employees directly related to themanufacturing and assembly process and administration, as provided undersubsection 4 of this section. A taxpayer seeking approval of a megaprojectshall submit an application to the department. The department shall notapprove any megaproject after December 31, 2008. The department shall notapprove any credits for megaprojects to be issued prior to January 1, 2013,and in no event shall the department authorize more than forty milliondollars to be issued annually for all megaprojects. The total amount ofcredits issued under this section shall not exceed two hundred fortymillion dollars.
2. In considering applications for approval of megaprojects, thedepartment may approve an application if:
(1) The taxpayer's project is financially sound and the taxpayer hasadequately demonstrated an ability to successfully undertake and completethe megaproject. This determination shall be supported by a professionalthird-party market feasibility analysis conducted on behalf of the state bya firm with direct experience with the industry of the proposedmegaproject, and by a professional third-party financial analysis of thetaxpayer's ability to complete the project;
(2) The taxpayer's plan of repayment to the state of the amount oftax credits provided is reasonable and sound;
(3) The taxpayer's megaproject will create new jobs that were notjobs previously performed by employees of the taxpayer or a relatedtaxpayer in Missouri;
(4) Local taxing entities are providing a significant level ofincentives for the megaproject relative to the projected new local taxrevenues created by the megaproject;
(5) There is at least one other state or foreign country that thetaxpayer verifies is being considered for the project, and receivingmegaproject tax credits is a major factor in the taxpayer's decision to goforward with the project and not receiving the credit will result in thetaxpayer not creating new jobs in Missouri;
(6) The megaproject will be located in an enhanced enterprise zonewhich constitutes an economic or social liability and a detriment to thepublic health, safety, morals, or welfare in its present condition and use;
(7) The completion of the megaproject will serve an essential publicmunicipal purpose by creating a substantial number of new jobs forcitizens, increasing their purchasing power, improving their livingconditions, and relieving the demand for unemployment and welfareassistance thereby promoting the economic development of the enhancedenterprise zone, the municipality, and the state; and
(8) The creation of new jobs will assist the state in providing theservices needed to protect the health, safety, and social and economicwell-being of the citizens of the state.
3. Prior to final approval of an application, a binding contractshall be executed between the taxpayer and the department of economicdevelopment which shall include, but not be limited to:
(1) A repayment plan providing for cash payment to the state generalrevenue fund which shall result in a positive internal rate of return tothe state and fully comply with the provisions of the World TradeOrganization Agreement on Subsidies and Countervailing Measures. The rateof return shall be commercially reasonable and, over the life of theproject, exceed one hundred and fifty percent of the state's borrowingcosts based on the AAA-rated twenty-year tax-exempt bond rate average overa twenty-year borrowing period. The rate shall be verified by aprofessional third-party financial analysis;
(2) The taxpayer's obligation to construct a facility of at least onemillion square feet within five years from the date of approval;
(3) A requirement that the issuance of tax credits authorized underthis section shall cease and the taxpayer shall immediately submit payment,to the state general revenue fund, in an amount equal to all creditspreviously issued less any amounts previously repaid, increased by anadditional amount that shall provide the state a reasonable rate of return,in the event the taxpayer:
(a) Fails to construct a facility of at least one million square feetwithin five years of the date of approval;
(b) Fails to make a scheduled payment as required by the repaymentplan; or
(c) Fails to compensate new jobs at rate equal to or in excess of thecounty average wage or fails to offer health insurance to all such new jobsand pay at least eighty percent of such premiums; and
(4) A requirement that the department shall suspend issuance of taxcredits authorized under this section if, at any point, the total amount oftax credits issued less the total amount of repayments received equals onehundred and fifty-five million dollars.
4. Upon approval of an application by the department, tax creditsshall be issued annually for a period not to exceed eight years from thecommencement of commercial operations of the megaproject. The eight-yearperiod for the issuance of megaproject tax credits may extend beyond theexpiration of the enhanced enterprise zone. The maximum percentage of theannual payroll of the taxpayer for new jobs located at the megaprojectwhich may be approved or issued by the department for tax credits shall notexceed:
(1) Eighty percent for the first three years that tax credits will beissued for the megaproject;
(2) Sixty percent for the next two subsequent years;
(3) Fifty percent for the next two subsequent years; and
(4) Thirty percent for the remaining year.
In no event shall the department issue more than forty million dollarsannually in megaproject tax credits to any taxpayer. In any given year,the amount of tax credits issued shall be the lesser of forty milliondollars, the applicable annual payroll percentage, or the amount of taxcredits remaining unissued under the two hundred forty million dollarlimitation on megaproject tax credit issuance provided under subsection 1of this section.
5. Tax credits issued under this section may be claimed against thetax imposed by chapter 143, RSMo, excluding withholding tax imposed bysections 143.191 to 143.265, RSMo. For taxpayers with flow-through taxtreatment of its members, partners, or shareholders, the credit shall beallowed to members, partners, or shareholders in proportion to their shareof ownership on the last day of the taxpayer's tax period. The director ofrevenue shall issue a refund to a taxpayer to the extent the amount ofcredits allowed in this section exceeds the amount of the taxpayer's incometax liability in the year redemption is authorized. An owner of taxcredits issued under this section shall not be required to have anyMissouri income tax liability in order to redeem such tax credits andreceive a refund. The director of revenue shall prepare a form to permitthe owner of such tax credits to obtain a refund.
6. Certificates of tax credits authorized under this section may betransferred, sold, or assigned by filing a notarized endorsement thereofwith the department that names the transferee, the amount of tax credittransferred, and the value received for the credit, as well as any otherinformation reasonably requested by the department. Upon such transfer,sale, or assignment, the transferee shall be the owner of such tax creditsentitled to claim the tax credits or any refunds with respect theretoissued to the taxpayer. Tax credits may not be carried forward past theyear of issuance. Tax credits authorized by this section may not bepledged or used to secure any bonds or other indebtedness issued by thestate or any political subdivision of the state. Once such tax creditshave been issued, nothing shall prohibit the owner of the tax credits frompledging the tax credits to any lender or other third party.
7. Any taxpayer issued tax credits under this section shall providean annual report to the department and the house and senate appropriationscommittees of the number of new jobs located at the megaproject, the newannual payroll of such new jobs, and such other information as may berequired by the department to document the basis for benefits under thissection. The department may withhold the approval of the annual issuanceof any tax credits until it is satisfied that proper documentation has beenprovided, and shall reduce the tax credits to reflect any reduction in newpayroll. If the department determines the average wage is below the countyaverage wage, or the taxpayer has not maintained employee health insuranceas required, the taxpayer shall not receive tax credits for that year.
8. Notwithstanding any provision of law to the contrary, any taxpayerwho is awarded tax credits under this section shall not also receive taxcredits under sections 135.100 to 135.150, sections 135.200 to 135.286,section 135.535, or sections 620.1875 to 620.1890, RSMo.
9. Any action brought in any court contesting the approval of amegaproject and the issuance of the tax credits, or any other actionundertaken pursuant to this section related to such megaproject, shall befiled within ninety days following approval of the megaproject by thedepartment.
10. Records and documents relating to a proposed megaproject shall bedeemed closed records until such time as the application has been approved.Provisions of this subsection to the contrary notwithstanding, recordscontaining business plan information which may endanger the competitivenessof the business shall remain closed.
11. Notwithstanding any provision of this section to the contrary, notaxpayer who receives megaproject tax credits authorized under this sectionor any related taxpayer shall employ, prior to January 1, 2022, directly:
(1) Any elected public official of this state holding office as ofJanuary 1, 2008;
(2) Any director, deputy director, division director, or employeedirectly involved in negotiations between the department of economicdevelopment and a taxpayer relative to the megaproject who was employed asof January 1, 2008, by the department.
Megaprojects, tax credit authorized, eligibility--departmentduties--binding contract required, when--issuance of credits,procedure.
135.968. 1. A taxpayer who establishes a megaproject, approved bythe department, within an enhanced enterprise zone shall, in exchange forthe consideration provided by new tax revenues and other economic stimulithat will be generated from the new jobs created by the megaproject, beallowed an income tax credit equal to the percentage of actual new annualpayroll of the taxpayer attributable to employees directly related to themanufacturing and assembly process and administration, as provided undersubsection 4 of this section. A taxpayer seeking approval of a megaprojectshall submit an application to the department. The department shall notapprove any megaproject after December 31, 2008. The department shall notapprove any credits for megaprojects to be issued prior to January 1, 2013,and in no event shall the department authorize more than forty milliondollars to be issued annually for all megaprojects. The total amount ofcredits issued under this section shall not exceed two hundred fortymillion dollars.
2. In considering applications for approval of megaprojects, thedepartment may approve an application if:
(1) The taxpayer's project is financially sound and the taxpayer hasadequately demonstrated an ability to successfully undertake and completethe megaproject. This determination shall be supported by a professionalthird-party market feasibility analysis conducted on behalf of the state bya firm with direct experience with the industry of the proposedmegaproject, and by a professional third-party financial analysis of thetaxpayer's ability to complete the project;
(2) The taxpayer's plan of repayment to the state of the amount oftax credits provided is reasonable and sound;
(3) The taxpayer's megaproject will create new jobs that were notjobs previously performed by employees of the taxpayer or a relatedtaxpayer in Missouri;
(4) Local taxing entities are providing a significant level ofincentives for the megaproject relative to the projected new local taxrevenues created by the megaproject;
(5) There is at least one other state or foreign country that thetaxpayer verifies is being considered for the project, and receivingmegaproject tax credits is a major factor in the taxpayer's decision to goforward with the project and not receiving the credit will result in thetaxpayer not creating new jobs in Missouri;
(6) The megaproject will be located in an enhanced enterprise zonewhich constitutes an economic or social liability and a detriment to thepublic health, safety, morals, or welfare in its present condition and use;
(7) The completion of the megaproject will serve an essential publicmunicipal purpose by creating a substantial number of new jobs forcitizens, increasing their purchasing power, improving their livingconditions, and relieving the demand for unemployment and welfareassistance thereby promoting the economic development of the enhancedenterprise zone, the municipality, and the state; and
(8) The creation of new jobs will assist the state in providing theservices needed to protect the health, safety, and social and economicwell-being of the citizens of the state.
3. Prior to final approval of an application, a binding contractshall be executed between the taxpayer and the department of economicdevelopment which shall include, but not be limited to:
(1) A repayment plan providing for cash payment to the state generalrevenue fund which shall result in a positive internal rate of return tothe state and fully comply with the provisions of the World TradeOrganization Agreement on Subsidies and Countervailing Measures. The rateof return shall be commercially reasonable and, over the life of theproject, exceed one hundred and fifty percent of the state's borrowingcosts based on the AAA-rated twenty-year tax-exempt bond rate average overa twenty-year borrowing period. The rate shall be verified by aprofessional third-party financial analysis;
(2) The taxpayer's obligation to construct a facility of at least onemillion square feet within five years from the date of approval;
(3) A requirement that the issuance of tax credits authorized underthis section shall cease and the taxpayer shall immediately submit payment,to the state general revenue fund, in an amount equal to all creditspreviously issued less any amounts previously repaid, increased by anadditional amount that shall provide the state a reasonable rate of return,in the event the taxpayer:
(a) Fails to construct a facility of at least one million square feetwithin five years of the date of approval;
(b) Fails to make a scheduled payment as required by the repaymentplan; or
(c) Fails to compensate new jobs at rate equal to or in excess of thecounty average wage or fails to offer health insurance to all such new jobsand pay at least eighty percent of such premiums; and
(4) A requirement that the department shall suspend issuance of taxcredits authorized under this section if, at any point, the total amount oftax credits issued less the total amount of repayments received equals onehundred and fifty-five million dollars.
4. Upon approval of an application by the department, tax creditsshall be issued annually for a period not to exceed eight years from thecommencement of commercial operations of the megaproject. The eight-yearperiod for the issuance of megaproject tax credits may extend beyond theexpiration of the enhanced enterprise zone. The maximum percentage of theannual payroll of the taxpayer for new jobs located at the megaprojectwhich may be approved or issued by the department for tax credits shall notexceed:
(1) Eighty percent for the first three years that tax credits will beissued for the megaproject;
(2) Sixty percent for the next two subsequent years;
(3) Fifty percent for the next two subsequent years; and
(4) Thirty percent for the remaining year.
In no event shall the department issue more than forty million dollarsannually in megaproject tax credits to any taxpayer. In any given year,the amount of tax credits issued shall be the lesser of forty milliondollars, the applicable annual payroll percentage, or the amount of taxcredits remaining unissued under the two hundred forty million dollarlimitation on megaproject tax credit issuance provided under subsection 1of this section.
5. Tax credits issued under this section may be claimed against thetax imposed by chapter 143, RSMo, excluding withholding tax imposed bysections 143.191 to 143.265, RSMo. For taxpayers with flow-through taxtreatment of its members, partners, or shareholders, the credit shall beallowed to members, partners, or shareholders in proportion to their shareof ownership on the last day of the taxpayer's tax period. The director ofrevenue shall issue a refund to a taxpayer to the extent the amount ofcredits allowed in this section exceeds the amount of the taxpayer's incometax liability in the year redemption is authorized. An owner of taxcredits issued under this section shall not be required to have anyMissouri income tax liability in order to redeem such tax credits andreceive a refund. The director of revenue shall prepare a form to permitthe owner of such tax credits to obtain a refund.
6. Certificates of tax credits authorized under this section may betransferred, sold, or assigned by filing a notarized endorsement thereofwith the department that names the transferee, the amount of tax credittransferred, and the value received for the credit, as well as any otherinformation reasonably requested by the department. Upon such transfer,sale, or assignment, the transferee shall be the owner of such tax creditsentitled to claim the tax credits or any refunds with respect theretoissued to the taxpayer. Tax credits may not be carried forward past theyear of issuance. Tax credits authorized by this section may not bepledged or used to secure any bonds or other indebtedness issued by thestate or any political subdivision of the state. Once such tax creditshave been issued, nothing shall prohibit the owner of the tax credits frompledging the tax credits to any lender or other third party.
7. Any taxpayer issued tax credits under this section shall providean annual report to the department and the house and senate appropriationscommittees of the number of new jobs located at the megaproject, the newannual payroll of such new jobs, and such other information as may berequired by the department to document the basis for benefits under thissection. The department may withhold the approval of the annual issuanceof any tax credits until it is satisfied that proper documentation has beenprovided, and shall reduce the tax credits to reflect any reduction in newpayroll. If the department determines the average wage is below the countyaverage wage, or the taxpayer has not maintained employee health insuranceas required, the taxpayer shall not receive tax credits for that year.
8. Notwithstanding any provision of law to the contrary, any taxpayerwho is awarded tax credits under this section shall not also receive taxcredits under sections 135.100 to 135.150, sections 135.200 to 135.286,section 135.535, or sections 620.1875 to 620.1890, RSMo.
9. Any action brought in any court contesting the approval of amegaproject and the issuance of the tax credits, or any other actionundertaken pursuant to this section related to such megaproject, shall befiled within ninety days following approval of the megaproject by thedepartment.
10. Records and documents relating to a proposed megaproject shall bedeemed closed records until such time as the application has been approved.Provisions of this subsection to the contrary notwithstanding, recordscontaining business plan information which may endanger the competitivenessof the business shall remain closed.
11. Notwithstanding any provision of this section to the contrary, notaxpayer who receives megaproject tax credits authorized under this sectionor any related taxpayer shall employ, prior to January 1, 2022, directly:
(1) Any elected public official of this state holding office as ofJanuary 1, 2008;
(2) Any director, deputy director, division director, or employeedirectly involved in negotiations between the department of economicdevelopment and a taxpayer relative to the megaproject who was employed asof January 1, 2008, by the department.
Megaprojects, tax credit authorized, eligibility--departmentduties--binding contract required, when--issuance of credits,procedure.
135.968. 1. A taxpayer who establishes a megaproject, approved bythe department, within an enhanced enterprise zone shall, in exchange forthe consideration provided by new tax revenues and other economic stimulithat will be generated from the new jobs created by the megaproject, beallowed an income tax credit equal to the percentage of actual new annualpayroll of the taxpayer attributable to employees directly related to themanufacturing and assembly process and administration, as provided undersubsection 4 of this section. A taxpayer seeking approval of a megaprojectshall submit an application to the department. The department shall notapprove any megaproject after December 31, 2008. The department shall notapprove any credits for megaprojects to be issued prior to January 1, 2013,and in no event shall the department authorize more than forty milliondollars to be issued annually for all megaprojects. The total amount ofcredits issued under this section shall not exceed two hundred fortymillion dollars.
2. In considering applications for approval of megaprojects, thedepartment may approve an application if:
(1) The taxpayer's project is financially sound and the taxpayer hasadequately demonstrated an ability to successfully undertake and completethe megaproject. This determination shall be supported by a professionalthird-party market feasibility analysis conducted on behalf of the state bya firm with direct experience with the industry of the proposedmegaproject, and by a professional third-party financial analysis of thetaxpayer's ability to complete the project;
(2) The taxpayer's plan of repayment to the state of the amount oftax credits provided is reasonable and sound;
(3) The taxpayer's megaproject will create new jobs that were notjobs previously performed by employees of the taxpayer or a relatedtaxpayer in Missouri;
(4) Local taxing entities are providing a significant level ofincentives for the megaproject relative to the projected new local taxrevenues created by the megaproject;
(5) There is at least one other state or foreign country that thetaxpayer verifies is being considered for the project, and receivingmegaproject tax credits is a major factor in the taxpayer's decision to goforward with the project and not receiving the credit will result in thetaxpayer not creating new jobs in Missouri;
(6) The megaproject will be located in an enhanced enterprise zonewhich constitutes an economic or social liability and a detriment to thepublic health, safety, morals, or welfare in its present condition and use;
(7) The completion of the megaproject will serve an essential publicmunicipal purpose by creating a substantial number of new jobs forcitizens, increasing their purchasing power, improving their livingconditions, and relieving the demand for unemployment and welfareassistance thereby promoting the economic development of the enhancedenterprise zone, the municipality, and the state; and
(8) The creation of new jobs will assist the state in providing theservices needed to protect the health, safety, and social and economicwell-being of the citizens of the state.
3. Prior to final approval of an application, a binding contractshall be executed between the taxpayer and the department of economicdevelopment which shall include, but not be limited to:
(1) A repayment plan providing for cash payment to the state generalrevenue fund which shall result in a positive internal rate of return tothe state and fully comply with the provisions of the World TradeOrganization Agreement on Subsidies and Countervailing Measures. The rateof return shall be commercially reasonable and, over the life of theproject, exceed one hundred and fifty percent of the state's borrowingcosts based on the AAA-rated twenty-year tax-exempt bond rate average overa twenty-year borrowing period. The rate shall be verified by aprofessional third-party financial analysis;
(2) The taxpayer's obligation to construct a facility of at least onemillion square feet within five years from the date of approval;
(3) A requirement that the issuance of tax credits authorized underthis section shall cease and the taxpayer shall immediately submit payment,to the state general revenue fund, in an amount equal to all creditspreviously issued less any amounts previously repaid, increased by anadditional amount that shall provide the state a reasonable rate of return,in the event the taxpayer:
(a) Fails to construct a facility of at least one million square feetwithin five years of the date of approval;
(b) Fails to make a scheduled payment as required by the repaymentplan; or
(c) Fails to compensate new jobs at rate equal to or in excess of thecounty average wage or fails to offer health insurance to all such new jobsand pay at least eighty percent of such premiums; and
(4) A requirement that the department shall suspend issuance of taxcredits authorized under this section if, at any point, the total amount oftax credits issued less the total amount of repayments received equals onehundred and fifty-five million dollars.
4. Upon approval of an application by the department, tax creditsshall be issued annually for a period not to exceed eight years from thecommencement of commercial operations of the megaproject. The eight-yearperiod for the issuance of megaproject tax credits may extend beyond theexpiration of the enhanced enterprise zone. The maximum percentage of theannual payroll of the taxpayer for new jobs located at the megaprojectwhich may be approved or issued by the department for tax credits shall notexceed:
(1) Eighty percent for the first three years that tax credits will beissued for the megaproject;
(2) Sixty percent for the next two subsequent years;
(3) Fifty percent for the next two subsequent years; and
(4) Thirty percent for the remaining year.
In no event shall the department issue more than forty million dollarsannually in megaproject tax credits to any taxpayer. In any given year,the amount of tax credits issued shall be the lesser of forty milliondollars, the applicable annual payroll percentage, or the amount of taxcredits remaining unissued under the two hundred forty million dollarlimitation on megaproject tax credit issuance provided under subsection 1of this section.
5. Tax credits issued under this section may be claimed against thetax imposed by chapter 143, RSMo, excluding withholding tax imposed bysections 143.191 to 143.265, RSMo. For taxpayers with flow-through taxtreatment of its members, partners, or shareholders, the credit shall beallowed to members, partners, or shareholders in proportion to their shareof ownership on the last day of the taxpayer's tax period. The director ofrevenue shall issue a refund to a taxpayer to the extent the amount ofcredits allowed in this section exceeds the amount of the taxpayer's incometax liability in the year redemption is authorized. An owner of taxcredits issued under this section shall not be required to have anyMissouri income tax liability in order to redeem such tax credits andreceive a refund. The director of revenue shall prepare a form to permitthe owner of such tax credits to obtain a refund.
6. Certificates of tax credits authorized under this section may betransferred, sold, or assigned by filing a notarized endorsement thereofwith the department that names the transferee, the amount of tax credittransferred, and the value received for the credit, as well as any otherinformation reasonably requested by the department. Upon such transfer,sale, or assignment, the transferee shall be the owner of such tax creditsentitled to claim the tax credits or any refunds with respect theretoissued to the taxpayer. Tax credits may not be carried forward past theyear of issuance. Tax credits authorized by this section may not bepledged or used to secure any bonds or other indebtedness issued by thestate or any political subdivision of the state. Once such tax creditshave been issued, nothing shall prohibit the owner of the tax credits frompledging the tax credits to any lender or other third party.
7. Any taxpayer issued tax credits under this section shall providean annual report to the department and the house and senate appropriationscommittees of the number of new jobs located at the megaproject, the newannual payroll of such new jobs, and such other information as may berequired by the department to document the basis for benefits under thissection. The department may withhold the approval of the annual issuanceof any tax credits until it is satisfied that proper documentation has beenprovided, and shall reduce the tax credits to reflect any reduction in newpayroll. If the department determines the average wage is below the countyaverage wage, or the taxpayer has not maintained employee health insuranceas required, the taxpayer shall not receive tax credits for that year.
8. Notwithstanding any provision of law to the contrary, any taxpayerwho is awarded tax credits under this section shall not also receive taxcredits under sections 135.100 to 135.150, sections 135.200 to 135.286,section 135.535, or sections 620.1875 to 620.1890, RSMo.
9. Any action brought in any court contesting the approval of amegaproject and the issuance of the tax credits, or any other actionundertaken pursuant to this section related to such megaproject, shall befiled within ninety days following approval of the megaproject by thedepartment.
10. Records and documents relating to a proposed megaproject shall bedeemed closed records until such time as the application has been approved.Provisions of this subsection to the contrary notwithstanding, recordscontaining business plan information which may endanger the competitivenessof the business shall remain closed.
11. Notwithstanding any provision of this section to the contrary, notaxpayer who receives megaproject tax credits authorized under this sectionor any related taxpayer shall employ, prior to January 1, 2022, directly:
(1) Any elected public official of this state holding office as ofJanuary 1, 2008;
(2) Any director, deputy director, division director, or employeedirectly involved in negotiations between the department of economicdevelopment and a taxpayer relative to the megaproject who was employed asof January 1, 2008, by the department.
