HS HB 197 -- ECONOMIC DEVELOPMENT PROJECTS (Johnson, 47)

ENTERPRISE ZONES AND SATELLITE ENTERPRISE ZONES

This substitute:

(1)  Allows Springfield to designate a satellite enterprise zone
within its corporate limits.  The zone must be on land owned by
the city which contains a wastewater treatment plant with a
capacity of 5.6 million cubic feet per day and an electrical
power plan with a capacity of at least 275 megawatts.  The city
must submit a plan to the Department of Economic Development
describing how the zone corresponds to the city's overall
enterprise zone strategy.  The zone will not be designated until
this plan is submitted and approved by the department's director;

(2)  Allows Sugar Creek to establish a satellite enterprise zone
within its corporate limits;

(3)  Allows St. Joseph to establish a satellite enterprise zone
within its corporate limits.  The city must submit a plan to the
department describing how the zone corresponds to the city's
overall enterprise zone strategy.  The zone will not be
designated until this plan is submitted and approved by the
department's director;

(4)  Requires the department to establish an enterprise zone in
the cities of Bourbon, Richland, and Raytown; and

(5)  Requires the department to establish Columbia as an
enterprise zone.

REBUILDING COMMUNITIES AND NEIGHBORHOOD PRESERVATION ACT

The substitute:

(1)  Expands the definition of "eligible costs for a new
residence" to include demolition;

(2)  Expands the definition of "eligible costs for
rehabilitation" to include expenses associated with the
renovation or rehabilitation of an existing structure;

(3)  Expands the definition of "eligible residence" to include
condominiums, entire apartment buildings, or single apartments
within an apartment building;

(4)  Expands the definition of "new residence" to include
condominiums, owner-occupied units or units intended to be
owner-occupied in an apartment building, and separate, adjacent
single-family units even when these types of units are not
located in a distressed community;

(5)  Expands the definition of "project" to include the new
construction, rehabilitation, or substantial rehabilitation of
multiple residences, whether comprised of one structure
containing multiple single-family residences (for example, an
apartment building) or multiple individual structures (for
example, townhouses or individual homes), in addition to single
residences;

(6)  Limits the tax credits available for the rehabilitation and
construction of residences in distressed communities and census
blocks to $1.5 million per project for those commenced after
August 28, 2003.  Under current law, of the $16 million in
community improvement tax credits allowed, $8 million are to be
allocated for "eligible residence" programs and $8 million for
"qualifying residence" programs.  The substitute states that if,
by October 1 of the calendar year, the Director of the Department
of Economic Development has issued all $8 million of the credits
allowed for one of these programs and has not issued the entire
$8 million allowance for the other program, the director is
required to reallocate 70% of any unused tax credits from the
program which has not reached its $8 million cap to the one which
has.  The reallocated credits will be given to taxpayers who have
applied for, but have not received, tax credits in that same year
and who are engaged in projects in the area where the tax credit
cap has been met for that same year.  The maximum reallocated tax
credit for any project may not exceed $500,000; and

(7)  Allows one application for tax credits to be submitted to
the department for preliminary approval in the case of projects
involving the new construction, rehabilitation, or substantial
rehabilitation of more than one residence.  Tax credits will be
awarded upon final approval of an application and presentation of
acceptable proof that substantial construction of each individual
residence has been completed, rather than delaying issuance of
the tax credits until the entire project is substantially
complete.

TAX CREDITS FOR INVESTMENT IN OR RELOCATING A BUSINESS TO A
DISTRESSED COMMUNITY

For a United States census block group, or contiguous group of
block groups, to be considered a "distressed community," current
law states that the population for the block group must be 2,500
and the median household income must be below 70% of the median
household income for the area to which the block group belongs.
The substitute decreases the population requirement to 500 and
increases the median household income threshold to 75% of the
median household income for the area to which the block group
belongs.

The substitute also expands the definition of a "distressed
community" to include areas within metropolitan statistical areas
that are designated as either a federal empowerment zone, a
federal enhanced enterprise community, or state enterprise zones
designated prior to January 1, 1986, but not to include the
expansion of those zones done after March 16, 1988.

FISCAL NOTE:  Estimated Net Loss to the General Revenue Fund of
Unknown in FY 2004, $1,410,747 to Unknown in FY 2005, and
$1,410,747 to Unknown in FY 2006.

Missouri House of Representatives
Last Updated July 25, 2003 at 10:11 am