Missouri Statute | Act | Code |Taxation And Revenue| US Code - US Statute

As used in sections 135.010 to 135.030 the following words and
terms mean:

(1) "Claimant", a person or persons claiming a credit under sections
135.010 to 135.030. If the persons are eligible to file a joint federal
income tax return and reside at the same address at any time during the
taxable year, then the credit may only be allowed if claimed on a
combined Missouri income tax return or a combined claim return reporting
their combined incomes and property taxes. A claimant shall not be
allowed a property tax credit unless the claimant or spouse has attained
the age of sixty-five on or before the last day of the calendar year and
the claimant or spouse was a resident of Missouri for the entire year, or
the claimant or spouse is a veteran of any branch of the armed forces of
the United States or this state who became one hundred percent disabled
as a result of such service, or the claimant or spouse is disabled as
defined in subdivision (2) of this section, and such claimant or spouse
provides proof of such disability in such form and manner, and at such
times, as the director of revenue may require, or if the claimant has
reached the age of sixty on or before the last day of the calendar year
and such claimant received surviving spouse Social Security benefits
during the calendar year and the claimant provides proof, as required by
the director of revenue, that the claimant received surviving spouse
Social Security benefits during the calendar year for which the credit
will be claimed. A claimant shall not be allowed a property tax credit if
the claimant filed a valid claim for a credit under section 137.106,
RSMo, in the year following the year for which the property tax credit is
claimed. The residency requirement shall be deemed to have been fulfilled
for the purpose of determining the eligibility of a surviving spouse for
a property tax credit if a person of the age of sixty-five years or older
who would have otherwise met the requirements for a property tax credit
dies before the last day of the calendar year. The residency requirement
shall also be deemed to have been fulfilled for the purpose of
determining the eligibility of a claimant who would have otherwise met
the requirements for a property tax credit but who dies before the last
day of the calendar year;

(2) "Disabled", the inability to engage in any substantial gainful
activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or which has lasted
or can be expected to last for a continuous period of not less than
twelve months. A claimant shall not be required to be gainfully employed
prior to such disability to qualify for a property tax credit;

(3) "Gross rent", amount paid by a claimant to a landlord for the rental,
at arm's length, of a homestead during the calendar year, exclusive of
charges for health and personal care services and food furnished as part
of the rental agreement, whether or not expressly set out in the rental
agreement. If the director of revenue determines that the landlord and
tenant have not dealt at arm's length, and that the gross rent is
excessive, then he shall determine the gross rent based upon a reasonable
amount of rent. Gross rent shall be deemed to be paid only if actually
paid prior to the date a return is filed. The director of revenue may
prescribe regulations requiring a return of information by a landlord
receiving rent, certifying for a calendar year the amount of gross rent
received from a tenant claiming a property tax credit and shall, by
regulation, provide a method for certification by the claimant of the
amount of gross rent paid for any calendar year for which a claim is
made. The regulations authorized by this subdivision may require a
landlord or a tenant or both to provide data relating to health and
personal care services and to food. Neither a landlord nor a tenant may
be required to provide data relating to utilities, furniture, home
furnishings or appliances;

(4) "Homestead", the dwelling in Missouri owned or rented by the claimant
and not to exceed five acres of land surrounding it as is reasonably
necessary for use of the dwelling as a home. It may consist of part of a
multidwelling or multipurpose building and part of the land upon which it
is built. "Owned" includes a vendee in possession under a land contract
and one or more tenants by the entireties, joint tenants, or tenants in
common and includes a claimant actually in possession if he was the
immediate former owner of record, if a lineal descendant is presently the
owner of record, and if the claimant actually pays all taxes upon the
property. It may include a mobile home;

(5) "Income", Missouri adjusted gross income as defined in section
143.121, RSMo, less two thousand dollars as an exemption for the
claimant's spouse residing at the same address, and increased, where
necessary, to reflect the following:

(a) Social Security, railroad retirement, and veterans payments and
benefits unless the claimant is a one hundred percent service-connected,
disabled veteran or a spouse of a one hundred percent service-connected,
disabled veteran. The one hundred percent service-connected disabled
veteran shall not be required to list veterans payments and benefits;

(b) The total amount of all other public and private pensions and
annuities;

(c) Public relief, public assistance, and unemployment benefits received
in cash, other than benefits received under this chapter;

(d) No deduction being allowed for losses not incurred in a trade or
business;

(e) Interest on the obligations of the United States, any state, or any
of their subdivisions and instrumentalities;

(6) "Property taxes accrued", property taxes paid, exclusive of special
assessments, penalties, interest, and charges for service levied on a
claimant's homestead in any calendar year. Property taxes shall qualify
for the credit only if actually paid prior to the date a return is filed.
The director of revenue shall require a tax receipt or other proof of
property tax payment. If a homestead is owned only partially by claimant,
then "property taxes accrued" is that part of property taxes levied on
the homestead which was actually paid by the claimant. For purposes of
this subdivision, property taxes are "levied" when the tax roll is
delivered to the director of revenue for collection. If a claimant owns a
homestead part of the preceding calendar year and rents it or a different
homestead for part of the same year, "property taxes accrued" means only
taxes levied on the homestead both owned and occupied by the claimant,
multiplied by the percentage of twelve months that such property was
owned and occupied as the homestead of the claimant during the year. When
a claimant owns and occupies two or more different homesteads in the same
calendar year, property taxes accrued shall be the sum of taxes allocable
to those several properties occupied by the claimant as a homestead for
the year. If a homestead is an integral part of a larger unit such as a
farm, or multipurpose or multidwelling building, property taxes accrued
shall be that percentage of the total property taxes accrued as the value
of the homestead is of the total value. For purposes of this subdivision
"unit" refers to the parcel of property covered by a single tax statement
of which the homestead is a part;

(7) "Rent constituting property taxes accrued", twenty percent of the
gross rent paid by a claimant and spouse in the calendar year. (L. 1973
H.B. 149, et al. § 1, A.L. 1975 H.B. 121, et al., A.L. 1979 S.B. 247, et
al., A.L. 1983 S.B. 47 & 29, A.L. 1988 S.B. 555, A.L. 1992 S.B. 797
merged with H.B. 1434 & 1490, A.L. 1994 H.B. 1745, A.L. 1996 H.B. 1098,
A.L. 1998 S.B. 675, et al., A.L. 2005 H.B. 58 merged with H.B. 186 merged
with H.B. 229 merged with H.B. 461)

Procedural matters related to filing a claim under sections
135.010 to 135.030, including refunds, deficiencies, interest, contents
of returns, limitations, and penalties shall be determined pursuant to
sections 143.481 to 143.996, RSMo, applicable to the income tax. The
credit regarding the property taxes of a calendar year may only be
claimed on a return for the calendar year or for a claimant's return for
a fiscal year that includes the end of the calendar year. (L. 1973 H.B.
149, et al., § 2, A.L. 1975 H.B. 121, et al., A.L. 1983 S.B. 47 & 29)

Effective 1-1-84

A credit for property taxes shall be allowed for the amount
provided in section 135.030. If the amount allowable as a credit exceeds
the income tax reduced by other credits, then the excess shall be
considered an overpayment of the income tax. (L. 1973 H.B. 149, et al.)

Effective 10-1-73

The property taxes accrued and rent constituting property taxes
accrued on each return shall be totaled. This total, up to seven hundred
fifty dollars, shall be used in determining the property tax credit. The
director of revenue shall prescribe regulations providing for allocations
where part of a claimant's homestead is rented to another or used for
nondwelling purposes or where a homestead is owned or rented or used as a
dwelling for part of a year. (L. 1973 H.B. 149, et al. § 4, A.L. 1975
H.B. 121, et al., A.L. 1988 S.B. 555)

Effective 1-1-89

1. As used in this section:

(1) The term "maximum upper limit" shall, in the calendar year 1989, be
the sum of thirteen thousand five hundred dollars. For each calendar year
through December 31, 1992, the maximum upper limit shall be increased by
five hundred dollars per year. For calendar years after December 31,
1992, and prior to calendar year 1998, the maximum upper limit shall be
the sum used on December 31, 1992. For each calendar year after December
31, 1997, the maximum upper limit shall be the sum of twenty-five
thousand dollars;

(2) The term "minimum base" shall, in the calendar year 1989, be the sum
of five thousand dollars. For each succeeding calendar year through
December 31, 1992, the minimum base shall be increased, in one
hundred-dollar increments, by the same percentage as the increase in the
general price level as measured by the Consumer Price Index for All Urban
Consumers for the United States, or its successor index, as defined and
officially recorded by the United States Department of Labor, or its
successor agency, or five percent, whichever is greater. The increase in
the index shall be that as first published by the Department of Labor for
the calendar year immediately preceding the year in which the minimum
base is calculated. For calendar years after December 31, 1992, and prior
to calendar year 1998, the minimum base shall be the sum used on December
31, 1992. For each calendar year after December 31, 1997, the minimum
base shall be the sum of thirteen thousand dollars.

2. When calculating the minimum base for purposes of this section,
whenever the increase in the Consumer Price Index used in the calculation
would result in a figure which is greater than one one-hundred-dollar
increment but less than another one-hundred-dollar increment, the
director of revenue shall always round that figure off to the next higher
one-hundred-dollar increment when determining the table of credits under
this section.

3. If the income on a return is equal to or less than the maximum upper
limit for the calendar year for which the return is filed, the property
tax credit shall be determined from a table of credits based upon the
amount by which the total property tax described in section 135.025
exceeds the percent of income in the following list: If the income on the
return is: The percent is: Not over the minimum base 0 percent with
credit not

to exceed actual property

tax or rent equivalent

paid up to $750 Over the minimum base but 1/16 percent accumulative not
over the maximum upper per $300 from 0 percent limit to 4 percent. The
director of revenue shall prescribe a table based upon the preceding
sentences. The property tax shall be in increments of twenty-five dollars
and the income in increments of three hundred dollars. The credit shall
be the amount rounded to the nearest whole dollar computed on the basis
of the property tax and income at the midpoints of each increment. As
used in this subsection, the term "accumulative" means an increase by
continuous or repeated application of the percent to the income increment
at each three hundred dollar level.

4. Notwithstanding the provision of subsection 4 of section 32.057, RSMo,
the department of revenue or any duly authorized employee or agent shall
determine whether any taxpayer filing a report or return with the
department of revenue who has not applied for the credit allowed pursuant
to section 135.020 may qualify for the credit, and shall notify any
qualified claimant of his or her potential eligibility, where the
department determines such potential eligibility exists. (L. 1973 H.B.
149, et al. § 5, A.L. 1975 H.B. 121, et al., A.L. 1977 S.B. 387, et al.,
A.L. 1979 S.B. 247, et al., A.L. 1983 S.B. 47 & 29, A.L. 1985 S.B. 69,
A.L. 1986 S.B. 751, A.L. 1988 S.B. 555, A.L. 1998 S.B. 675, et al.)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

Sections 135.010, 135.015, 135.025, and 135.030 shall be
effective with respect to claims filed for the calendar year 1975 and
thereafter. (L. 1975 H.B. 121, et al. § A)

For all tax years beginning on or after January 1, 1999, but
before December 31, 2001, a resident individual who has attained
sixty-five years of age on or before the last day of the tax year shall
be allowed, for the purpose of offsetting the cost of legend drugs, a
maximum credit against the tax otherwise due pursuant to chapter 143,
RSMo, not including sections 143.191 to 143.265, RSMo, of two hundred
dollars. An individual shall be entitled to the maximum credit allowed by
this section if the individual has a Missouri adjusted gross income of
fifteen thousand dollars or less; provided that, no individual who
receives full reimbursement for the cost of legend drugs from Medicare or
Medicaid, or who is a resident of a local, state or federally funded
facility shall qualify for the credit allowed pursuant to this section.
If an individual's Missouri adjusted gross income is greater than fifteen
thousand dollars, such individual shall be entitled to a credit equal to
the greater of zero or the maximum credit allowed by this section reduced
by two dollars for every hundred dollars such individual's income exceeds
fifteen thousand dollars. The credit shall be claimed as prescribed by
the director of the department of revenue. Such credit shall be
considered an overpayment of tax and shall be refundable even if the
amount of the credit exceeds an individual's tax liability. (L. 1999 S.B.
14, et al. § 1, A.L. 2001 1st Ex. Sess. H.B. 3 merged with S.B. 4, et al.)

Effective 10-5-01

1. In order to promote personal financial responsibility for
long-term health care in this state, for all taxable years beginning
after December 31, 1999, a resident individual may deduct from such
individual's Missouri taxable income an amount equal to fifty percent of
all nonreimbursed amounts paid by such individual for qualified long-term
care insurance premiums to the extent such amounts are not included the
individual's itemized deductions. A married individual filing a Missouri
income tax return separately from his or her spouse shall be allowed to
make a deduction pursuant to this section in an amount equal to the
proportion of such individual's payment of all qualified long-term care
insurance premiums. The director of the department of revenue shall place
a line on all Missouri individual income tax returns for the deduction
created by this section.

2. For purposes of this section, "qualified long-term care insurance"
means any policy which meets or exceeds the provisions of sections
376.1100 to 376.1118, RSMo, and the rules and regulations promulgated
pursuant to such sections for long-term care insurance. (L. 1999 S.B. 8 &
173 § 8)

Effective 1-1-00

*Reprinted due to editorial change.

As used in sections 135.100 to 135.150 the following terms shall
mean:

(1) "Commencement of commercial operations" shall be deemed to occur
during the first taxable year for which the new business facility is
first available for use by the taxpayer, or first capable of being used
by the taxpayer, in the revenue-producing enterprise in which the
taxpayer intends to use the new business facility;

(2) "Existing business facility", any facility in this state which was
employed by the taxpayer claiming the credit in the operation of a
revenue-producing enterprise immediately prior to an expansion,
acquisition, addition, or replacement;

(3) "Facility", any building used as a revenue-producing enterprise
located within the state, including the land on which the facility is
located and all machinery, equipment and other real and depreciable
tangible personal property acquired for use at and located at or within
such facility and used in connection with the operation of such facility;

(4) "New business facility", a facility which satisfies the following
requirements:

(a) Such facility is employed by the taxpayer in the operation of a
revenue-producing enterprise. Such facility shall not be considered a new
business facility in the hands of the taxpayer if the taxpayer's only
activity with respect to such facility is to lease it to another person
or persons. If the taxpayer employs only a portion of such facility in
the operation of a revenue-producing enterprise, and leases another
portion of such facility to another person or persons or does not
otherwise use such other portions in the operation of a revenue-producing
enterprise, the portion employed by the taxpayer in the operation of a
revenue-producing enterprise shall be considered a new business facility,
if the requirements of paragraphs (b), (c), (d) and (e) of this
subdivision are satisfied;

(b) Such facility is acquired by, or leased to, the taxpayer after
December 31, 1983. A facility shall be deemed to have been acquired by,
or leased to, the taxpayer after December 31, 1983, if the transfer of
title to the taxpayer, the transfer of possession pursuant to a binding
contract to transfer title to the taxpayer, or the commencement of the
term of the lease to the taxpayer occurs after December 31, 1983, or, if
the facility is constructed, erected or installed by or on behalf of the
taxpayer, such construction, erection or installation is commenced after
December 31, 1983;

(c) If such facility was acquired by the taxpayer from another person or
persons and such facility was employed immediately prior to the transfer
of title to such facility to the taxpayer, or to the commencement of the
term of the lease of such facility to the taxpayer, by any other person
or persons in the operation of a revenue-producing enterprise, the
operation of the same or a substantially similar revenue-producing
enterprise is not continued by the taxpayer at such facility;

(d) Such facility is not a replacement business facility, as defined in
subdivision (10) of this section; and

(e) The new business facility investment exceeds one hundred thousand
dollars during the tax period in which the credits are claimed;

(5) "New business facility employee", a person employed by the taxpayer
in the operation of a new business facility during the taxable year for
which the credit allowed by section 135.110 is claimed, except that truck
drivers and rail and barge vehicle operators shall not constitute new
business facility employees. A person shall be deemed to be so employed
if such person performs duties in connection with the operation of the
new business facility on:

(a) A regular, full-time basis; or

(b) A part-time basis, provided such person is customarily performing
such duties an average of at least twenty hours per week; or

(c) A seasonal basis, provided such person performs such duties for at
least eighty percent of the season customary for the position in which
such person is employed;

(6) "New business facility income", the Missouri taxable income, as
defined in chapter 143, RSMo, derived by the taxpayer from the operation
of the new business facility. For the purpose of apportionment as
prescribed in this subdivision, the term "Missouri taxable income" means,
in the case of insurance companies, direct premiums as defined in chapter
148, RSMo. If a taxpayer has income derived from the operation of a new
business facility as well as from other activities conducted within this
state, the Missouri taxable income derived by the taxpayer from the
operation of the new business facility shall be determined by multiplying
the taxpayer's Missouri taxable income, computed in accordance with
chapter 143, RSMo, or in the case of an insurance company, computed in
accordance with chapter 148, RSMo, by a fraction, the numerator of which
is the property factor, as defined in paragraph (a) of this subdivision,
plus the payroll factor, as defined in paragraph (b) of this subdivision,
and the denominator of which is two:

(a) The property factor is a fraction, the numerator of which is the new
business facility investment certified for the tax period, and the
denominator of which is the average value of all the taxpayer's real and
depreciable tangible personal property owned or rented and used in this
state during the tax period. The average value of all such property shall
be determined as provided in chapter 32, RSMo;

(b) The payroll factor is a fraction, the numerator of which is the total
amount paid during the tax period by the taxpayer for compensation to
persons qualifying as new business facility employees, as determined by
subsection 4 of section 135.110, at the new business facility, and the
denominator of which is the total amount paid in this state during the
tax period by the taxpayer for compensation. The compensation paid in
this state shall be determined as provided in chapter 32, RSMo. For the
purpose of this subdivision, "other activities conducted within this
state" shall include activities previously conducted at the expanded,
acquired or replaced facility at any time during the tax period
immediately prior to the tax period in which commencement of commercial
operations occurred;

(7) "New business facility investment", the value of real and depreciable
tangible personal property, acquired by the taxpayer as part of the new
business facility, which is used by the taxpayer in the operation of the
new business facility, during the taxable year for which the credit
allowed by section 135.110 is claimed, except that trucks,
truck-trailers, truck semitrailers, rail vehicles, barge vehicles,
aircraft and other rolling stock for hire, track, switches, barges,
bridges, tunnels and rail yards and spurs shall not constitute new
business facility investments. The total value of such property during
such taxable year shall be:

(a) Its original cost if owned by the taxpayer; or

(b) Eight times the net annual rental rate, if leased by the taxpayer.
The net annual rental rate shall be the annual rental rate paid by the
taxpayer less any annual rental rate received by the taxpayer from
subrentals. The new business facility investment shall be determined by
dividing by twelve the sum of the total value of such property on the
last business day of each calendar month of the taxable year. If the new
business facility is in operation for less than an entire taxable year,
the new business facility investment shall be determined by dividing the
sum of the total value of such property on the last business day of each
full calendar month during the portion of such taxable year during which
the new business facility was in operation by the number of full calendar
months during such period;

(8) "Office", a regional, national or international headquarters, a
telemarketing operation, a computer operation, an insurance company, a
passenger transportation ticket/reservation system or a credit card
billing and processing center. For the purposes of this subdivision,
"headquarters" means the administrative management of at least four
integrated facilities operated by the taxpayer or related taxpayer. An
office, as defined in this subdivision, when established must create and
maintain positions for a minimum number of twenty-five new business
facility employees as defined in subdivision (5) of this section;

(9) "Related taxpayer" shall mean:

(a) A corporation, partnership, trust or association controlled by the
taxpayer;

(b) An individual, corporation, partnership, trust or association in
control of the taxpayer; or

(c) A corporation, partnership, trust or association controlled by an
individual, corporation, partnership, trust or association in control of
the taxpayer. For the purposes of sections 135.100 to 135.150, "control
of a corporation" shall mean ownership, directly or indirectly, of stock
possessing at least fifty percent of the total combined voting power of
all classes of stock entitled to vote; "control of a partnership or
association" shall mean ownership of at least fifty percent of the
capital or profits interest in such partnership or association; and
"control of a trust" shall mean ownership, directly or indirectly, of at
least fifty percent of the beneficial interest in the principal or income
of such trust; ownership shall be determined as provided in Section 318
of the U.S. Internal Revenue Code;

(10) "Replacement business facility", a facility otherwise described in
subdivision (4) of this section, hereafter referred to in this
subdivision as "new facility", which replaces another facility, hereafter
referred to in this subdivision as "old facility", located within the
state, which the taxpayer or a related taxpayer previously operated but
discontinued operating on or before the close of the first taxable year
in which the credit allowed by this section is claimed. A new facility
shall be deemed to replace an old facility if the following conditions
are met:

(a) The old facility was operated by the taxpayer or a related taxpayer
during the taxpayer's or related taxpayer's taxable period immediately
preceding the taxable year in which commencement of commercial operations
occurs at the new facility; and

(b) The old facility was employed by the taxpayer or a related taxpayer
in the operation of a revenue-producing enterprise and the taxpayer
continues the operation of the same or substantially similar
revenue-producing enterprise at the new facility.

Notwithstanding the preceding provisions of this subdivision, a facility
shall not be considered a replacement business facility if the taxpayer's
new business facility investment, as computed in subsection 5 of section
135.110, in the new facility during the tax period in which the credits
allowed in sections 135.110, 135.225 and 135.235 and the exemption
allowed in section 135.220 are claimed exceed one million dollars or, if
less, two hundred percent of the investment in the old facility by the
taxpayer or related taxpayer, and if the total number of employees at the
new facility exceeds the total number of employees at the old facility by
at least two except that the total number of employees at the new
facility exceeds the total number of employees at the old facility by at
least twenty-five if an office as defined in subdivision (8) of this
section is established by a revenue-producing enterprise other than a
revenue-producing enterprise defined in paragraphs (a) to (g) and (i) to
(l) of subdivision (11) of this section;

(11) "Revenue-producing enterprise" means:

(a) Manufacturing activities classified as SICs 20 through 39;

(b) Agricultural activities classified as SIC 025;

(c) Rail transportation terminal activities classified as SIC 4013;

(d) Motor freight transportation terminal activities classified as SIC
4231;

(e) Public warehousing and storage activities classified as SICs 422 and
423 except SIC 4221, miniwarehouse warehousing and warehousing
self-storage;

(f) Water transportation terminal activities classified as SIC 4491;

(g) Airports, flying fields, and airport terminal services classified as
SIC 4581;

(h) Wholesale trade activities classified as SICs 50 and 51;

(i) Insurance carriers activities classified as SICs 631, 632 and 633;

(j) Research and development activities classified as SIC 873, except
8733;

(k) Farm implement dealer activities classified as SIC 5999;

(l) Interexchange telecommunications services as defined in subdivision
(20) of section 386.020, RSMo, or training activities conducted by an
interexchange telecommunications company as defined in subdivision (19)
of section 386.020, RSMo;

(m) Recycling activities classified as SIC 5093;

(n) Office activities as defined in subdivision (8) of this section,
notwithstanding SIC classification;

(o) Mining activities classified as SICs 10 through 14;

(p) Computer programming, data processing and other computer-related
activities classified as SIC 737;

(q) The administrative management of any of the foregoing activities; or

(r) Any combination of any of the foregoing activities;

(12) "Same or substantially similar revenue-producing enterprise", a
revenue-producing enterprise in which the nature of the products produced
or sold, or activities conducted, are similar in character and use or are
produced, sold, performed or conducted in the same or similar manner as
in another revenue- producing enterprise;

(13) "SIC", the standard industrial classification as such
classifications are defined in the 1987 edition of the Standard
Industrial Classification Manual as prepared by the Executive Office of
the President, Office of Management and Budget;

(14) "Taxpayer", an individual proprietorship, corporation described in
section 143.441 or 143.471, RSMo, and partnership or an insurance company
subject to the tax imposed by chapter 148, RSMo, or in the case of an
insurance company exempt from the thirty-percent employee requirement of
section 135.230, to any obligation imposed pursuant to section 375.916,
RSMo. (L. 1980 S.B. 644 § 1, A.L. 1983 H.B. 54, A.L. 1985 H.B. 416, A.L.
1986 S.B. 727, A.L. 1991 H.B. 294 & 405, A.L. 1992 S.B. 661 & 620, A.L.
1993 H.B. 566, A.L. 1994 H.B. 1248 & 1048, A.L. 1995 H.B. 414, A.L. 1996
H.B. 1237, A.L. 1997 2d Ex. Sess. S.B. 1, A.L. 1998 S.B. 827, A.L. 1999
H.B. 701)

*Two versions of this section are printed here due to a technical
drafting error.

1. Any taxpayer who shall establish a new business facility
shall be allowed a credit, each year for ten years, in an amount
determined pursuant to subsection 2 or 3 of this section, whichever is
applicable, against the tax imposed by chapter 143, RSMo, excluding
withholding tax imposed by sections 143.191 to 143.265, RSMo, or an
insurance company which shall establish a new business facility by
satisfying the requirements in subdivision (7) of section 135.100 shall
be allowed a credit against the tax otherwise imposed by chapter 148,
RSMo, and in the case of an insurance company exempt from the thirty
percent employee requirement of section 135.230, against any obligation
imposed pursuant to section 375.916, RSMo, except that no taxpayer shall
be entitled to multiple ten-year periods for subsequent expansions at the
same facility, except as otherwise provided in this section. For the
purpose of this section, the term "facility" shall mean, and be limited
to, the facility or facilities which are located on the same site in
which the new business facility is located, and in which the business
conducted at such facility or facilities is directly related to the
business conducted at the new business facility. Notwithstanding the
provisions of this subsection, a taxpayer may be entitled to an
additional ten-year period if a new business facility is expanded in the
eighth, ninth or tenth year of the current ten-year period or in
subsequent years following the expiration of the ten-year period, if the
number of new business facility employees attributed to such expansion is
at least twenty-five and the amount of new business facility investment
attributed to such expansion is at least one million dollars. Credits may
not be carried forward but shall be claimed for the taxable year during
which commencement of commercial operations occurs at such new business
facility, and for each of the nine succeeding taxable years. A letter of
intent, as provided for in section 135.258, must be filed with the
department of economic development no later than fifteen days prior to
the commencement of commercial operations at the new business facility.
The initial application for claiming tax credits must be made in the
taxpayer's tax period immediately following the tax period in which
commencement of commercial operations began at the new business facility.
This provision shall have effect on all initial applications filed on or
after August 28, 1992. No credit shall be allowed pursuant to this
section unless the number of new business facility employees engaged or
maintained in employment at the new business facility for the taxable
year for which the credit is claimed equals or exceeds two; except that
the number of new business facility employees engaged or maintained in
employment by a revenue-producing enterprise other than a
revenue-producing enterprise defined in paragraphs (a) to (g) and (i) to
(l) of subdivision (11) of section 135.100 which establishes an office as
defined in subdivision (8) of section 135.100 shall equal or exceed
twenty-five.

2. For tax periods beginning after August 28, 1991, in the case of a
taxpayer operating an existing business facility, the credit allowed by
subsection 1 of this section shall offset the greater of:

(1) Some portion of the income tax otherwise imposed by chapter 143,
RSMo, excluding withholding tax imposed by sections 143.191 to 143.265,
RSMo, or in the case of an insurance company, the tax on the direct
premiums, as defined in chapter 148, RSMo, and in the case of an
insurance company exempt from the thirty percent employee requirement of
section 135.230, against any obligation imposed pursuant to section
375.916, RSMo, with respect to such taxpayer's new business facility
income for the taxable year for which such credit is allowed; or

(2) Up to fifty percent or, in the case of an economic development
project located within a distressed community as defined in section
135.530, seventy-five percent of the business income tax otherwise
imposed by chapter 143, RSMo, excluding withholding tax imposed by
sections 143.191 to 143.265, RSMo, or in the case of an insurance
company, the tax on the direct premiums, as defined in chapter 148, RSMo,
and in the case of an insurance company exempt from the thirty percent
employee requirement of section 135.230, against any obligation imposed
pursuant to section 375.916, RSMo, if the business operates no other
facilities in Missouri. In the case of an existing business facility
operating more than one facility in Missouri, the credit allowed in
subsection 1 of this section shall offset up to the greater of the
portion prescribed in subdivision (1) of this subsection or twenty-five
percent or, in the case of an economic development project located within
a distressed community as defined in section 135.530, thirty-five percent
of the business' tax, except that no taxpayer operating more than one
facility in Missouri shall be allowed to offset more than twenty-five
percent or, in the case of an economic development project located within
a distressed community as defined in section 135.530, thirty-five percent
of the taxpayer's business income tax in any tax period under the method
prescribed in this subdivision. Such credit shall be an amount equal to
the sum of one hundred dollars or, in the case of an economic development
project located within a distressed community as defined in section
135.530, one hundred fifty dollars for each new business facility
employee plus one hundred dollars or, in the case of an economic
development project located within a distressed community as defined in
section 135.530, one hundred fifty dollars for each one hundred thousand
dollars, or major fraction thereof (which shall be deemed to be fifty-one
percent or more) in new business facility investment. For the purpose of
this section, tax credits earned by a taxpayer, who establishes a new
business facility because it satisfies the requirements of paragraph (c)
of subdivision (4) of section 135.100, shall offset the greater of the
portion prescribed in subdivision (1) of this subsection or up to fifty
percent or, in the case of an economic development project located within
a distressed community as defined in section 135.530, seventy-five
percent of the business' tax provided the business operates no other
facilities in Missouri. In the case of a business operating more than one
facility in Missouri, the credit allowed in subsection 1 of this section
shall offset up to the greater of the portion prescribed in subdivision
(1) of this subsection or twenty-five percent or, in the case of an
economic development project located within a distressed community as
defined in section 135.530, thirty-five percent of the business' tax,
except that no taxpayer operating more than one facility in Missouri
shall be allowed to offset more than twenty-five percent or, in the case
of an economic development project located within a distressed community
as defined in section 135.530, thirty-five percent of the taxpayer's
business income tax in any tax period under the method prescribed in this
subdivision.

3. For tax periods beginning after August 28, 1991, in the case of a
taxpayer not operating an existing business facility, the credit allowed
by subsection 1 of this section shall offset the greater of:

(1) Some portion of the income tax otherwise imposed by chapter 143,
RSMo, excluding withholding tax imposed by sections 143.191 to 143.265,
RSMo, or in the case of an insurance company, the tax on the direct
premiums, as defined in chapter 148, RSMo, and in the case of an
insurance company exempt from the thirty percent employee requirement of
section 135.230, against any obligation imposed pursuant to section
375.916, RSMo, with respect to such taxpayer's new business facility
income for the taxable year for which such credit is allowed; or

(2) Up to one hundred percent of the business income tax otherwise
imposed by chapter 143, RSMo, excluding withholding tax imposed by
sections 143.191 to 143.265, RSMo, or in the case of an insurance
company, the tax on the direct premiums, as defined in chapter 148, RSMo,
and in the case of an insurance company exempt from the thirty percent
employee requirement of section 135.230, against any obligation imposed
pursuant to section 375.916, RSMo, if the business has no other
facilities operating in Missouri. In the case of a taxpayer not operating
an existing business and operating more than one facility in Missouri,
the credit allowed by subsection 1 of this section shall offset up to the
greater of the portion prescribed in subdivision (1) of this subsection
or twenty-five percent or, in the case of an economic development project
located within a distressed community as defined in section 135.530,
thirty-five percent of the business' tax, except that no taxpayer
operating more than one facility in Missouri shall be allowed to offset
more than twenty-five percent or, in the case of an economic development
project located within a distressed community as defined in section
135.530, thirty-five percent of the taxpayer's business income tax in any
tax period under the method prescribed in this subdivision. Such credit
shall be an amount equal to the sum of seventy-five dollars or, in the
case of an economic development project located within a distressed
community as defined in section 135.530, one hundred twenty-five dollars
for each new business facility employee plus seventy-five dollars or, in
the case of an economic development project located within a distressed
community as defined in section 135.530, one hundred twenty-five dollars
for each one hundred thousand dollars, or major fraction thereof (which
shall be deemed to be fifty-one percent or more) in new business facility
investment.

4. The number of new business facility employees during any taxable year
shall be determined by dividing by twelve the sum of the number of
individuals employed on the last business day of each month of such
taxable year. If the new business facility is in operation for less than
the entire taxable year, the number of new business facility employees
shall be determined by dividing the sum of the number of individuals
employed on the last business day of each full calendar month during the
portion of such taxable year during which the new business facility was
in operation by the number of full calendar months during such period.
For the purpose of computing the credit allowed by this section in the
case of a facility which qualifies as a new business facility because it
qualifies as a separate facility pursuant to subsection 6 of this
section, and, in the case of a new business facility which satisfies the
requirements of paragraph (c) of subdivision (4) of section 135.100, or
subdivision (10) of section 135.100, the number of new business facility
employees at such facility shall be reduced by the average number of
individuals employed, computed as provided in this subsection, at the
facility during the taxable year immediately preceding the taxable year
in which such expansion, acquisition, or replacement occurred and shall
further be reduced by the number of individuals employed by the taxpayer
or related taxpayer that was subsequently transferred to the new business
facility from another Missouri facility and for which credits authorized
in this section are not being earned, whether such credits are earned
because of an expansion, acquisition, relocation or the establishment of
a new facility.

5. For the purpose of computing the credit allowed by this section in the
case of a facility which qualifies as a new business facility because it
qualifies as a separate facility pursuant to subsection 6 of this
section, and, in the case of a new business facility which satisfies the
requirements of paragraph (c) of subdivision (4) of section 135.100 or
subdivision (10) of section 135.100, the amount of the taxpayer's new
business facility investment in such facility shall be reduced by the
average amount, computed as provided in subdivision (7) of section
135.100 for new business facility investment, of the investment of the
taxpayer, or related taxpayer immediately preceding such expansion or
replacement or at the time of acquisition. Furthermore, the amount of the
taxpayer's new business facility investment shall also be reduced by the
amount of investment employed by the taxpayer or related taxpayer which
was subsequently transferred to the new business facility from another
Missouri facility and for which credits authorized in this section are
not being earned, whether such credits are earned because of an
expansion, acquisition, relocation or the establishment of a new facility.

6. If a facility, which does not constitute a new business facility, is
expanded by the taxpayer, the expansion shall be considered a separate
facility eligible for the credit allowed by this section if:

(1) The taxpayer's new business facility investment in the expansion
during the tax period in which the credits allowed in this section are
claimed exceeds one hundred thousand dollars, or, if less, one hundred
percent of the investment in the original facility prior to expansion and
if the number of new business facility employees engaged or maintained in
employment at the expansion facility for the taxable year for which
credit is claimed equals or exceeds two, except that the number of new
business facility employees engaged or maintained in employment at the
expansion facility for the taxable year for which the credit is claimed
equals or exceeds twenty-five if an office as defined in subdivision (8)
of section 135.100 is established by a revenue-producing enterprise other
than a revenue-producing enterprise defined in paragraphs (a) to (g) and
(i) to (l) of subdivision (11) of section 135.100 and the total number of
employees at the facility after the expansion is at least two greater
than the total number of employees before the expansion, except that the
total number of employees at the facility after the expansion is at least
greater than the number of employees before the expansion by twenty-five,
if an office as defined in subdivision (8) of section 135.100 is
established by a revenue-producing enterprise other than a
revenue-producing enterprise defined in paragraphs (a) to (g) and (i) to
(l) of subdivision (11) of section 135.100; and

(2) The expansion otherwise constitutes a new business facility. The
taxpayer's investment in the expansion and in the original facility prior
to expansion shall be determined in the manner provided in subdivision
(7) of section 135.100.

7. No credit shall be allowed pursuant to this section to a public
utility, as such term is defined in section 386.020, RSMo.
Notwithstanding any provision of this subsection to the contrary, motor
carriers, barge lines or railroads engaged in transporting property for
hire, or any interexchange telecommunications company or local exchange
telecommunications company that establishes a new business facility shall
be eligible to qualify for credits allowed in this section.

8. For the purposes of the credit described in this section, in the case
of a corporation described in section 143.471, RSMo, or partnership, in
computing Missouri's tax liability, this credit shall be allowed to the
following:

(1) The shareholders of the corporation described in section 143.471,
RSMo;

(2) The partners of the partnership.

This credit shall be apportioned to the entities described in
subdivisions (1) and (2) of this subsection in proportion to their share
of ownership on the last day of the taxpayer's tax period.

9. Notwithstanding any provision of law to the contrary, any
employee-owned engineering firm classified as SIC 8711, architectural
firm as classified SIC 8712, or accounting firm classified SIC 8721
establishing a new business facility because it qualifies as a
headquarters as defined in subsection 10 of this section, shall be
allowed the credits described in subsection 11 of this section under the
same terms and conditions prescribed in sections 135.100 to 135.150;
provided:

(1) Such facility maintains an average of at least five hundred new
business facility employees as defined in subdivision (5) of section
135.100 during the taxpayer's tax period in which such credits are being
claimed; and

(2) Such facility maintains an average of at least twenty million dollars
in new business facility investment as defined in subdivision (7) of
section 135.100 during the taxpayer's tax period in which such credits
are being claimed.

10. For the purpose of the credits allowed in subsection 9 of this
section:

(1) "Employee-owned" means the business employees own directly or
indirectly, including through an employee stock ownership plan or trust
at least:

(a) Seventy-five percent of the total business stock, if the taxpayer is
a corporation described in section 143.441, RSMo; or

(b) One hundred percent of the interest in the business if the taxpayer
is a corporation described in section 143.471, RSMo, a partnership, or a
limited liability company; and

(2) "Headquarters" means:

(a) The administrative management of at least three integrated facilities
operated by the taxpayer or related taxpayer; and

(b) The taxpayer's business has been headquartered in this state for more
than fifty years.

11. The tax credits allowed in subsection 9 of this section shall be the
greater of:

(1) Four hundred dollars for each new business facility employee as
computed in subsection 4 of this section and four percent of new business
facility investment as computed in subsection 5 of this section; or

(2) Five hundred dollars for each new business facility employee as
computed in subsection 4 of this section, and five hundred dollars of
each one hundred thousand dollars of new business facility investment as
computed in subsection 5 of this section.

12. For the purpose of the credit described in subsection 9 of this
section, in the case of a small corporation described in section 143.471,
RSMo, or a partnership, or a limited liability company, the credits
allowed in subsection 9 of this section shall be apportioned in
proportion to the share of ownership of each shareholder, partner or
stockholder on the last day of the taxpayer's tax period for which such
credits are being claimed.

13. For the purpose of the credit described in subsection 9 of this
section, tax credits earned, to the extent such credits exceed the
taxpayer's Missouri tax on taxable business income, shall constitute an
overpayment of taxes and in such case, be refunded to the taxpayer
provided such refunds are used by the taxpayer to purchase specified
facility items. For the purpose of the refund as authorized in this
subsection, "specified facility items" means equipment, computers,
computer software, copiers, tenant finishing, furniture and fixtures
installed and in use at the new business facility during the taxpayer's
taxable year. The taxpayer shall perfect such refund by attesting in
writing to the director, subject to the penalties of perjury, the
requirements prescribed in this subsection have been met and submitting
any other information the director may require.

14. Notwithstanding any provision of law to the contrary, any taxpayer
may sell, assign, exchange, convey or otherwise transfer tax credits
allowed in subsection 9 of this section under the terms and conditions
prescribed in subdivisions (1) and (2) of this subsection. Such taxpayer,
referred to as the assignor for the purpose of this subsection, may sell,
assign, exchange or otherwise transfer earned tax credits:

(1) For no less than seventy-five percent of the par value of such
credits; and

(2) In an amount not to exceed one hundred percent of such earned
credits. The taxpayer acquiring the earned credits referred to as the
assignee for the purpose of this subsection may use the acquired credits
to offset up to one hundred percent of the tax liabilities otherwise
imposed by chapter 143, RSMo, excluding withholding tax imposed by
sections 143.191 to 143.261, RSMo, or chapter 148, RSMo, or in the case
of an insurance company exempt from the thirty percent employee
requirement of section 135.230, against any obligation imposed pursuant
to section 375.916, RSMo. Unused credits in the hands of the assignee may
be carried forward for up to five tax periods, provided all such credits
shall be claimed within ten tax periods following the tax period in which
commencement of commercial operations occurred at the new business
facility. The assignor shall enter into a written agreement with the
assignee establishing the terms and conditions of the agreement and shall
perfect such transfer by notifying the director in writing within thirty
calendar days following the effective date of the transfer and shall
provide any information as may be required by the director to administer
and carry out the provisions of this subsection. Notwithstanding any
other provision of law to the contrary, the amount received by the
assignor of such tax credit shall be taxable as income of the assignor,
and the difference between the amount paid by the assignee and the par
value of the credits shall be taxable as income of the assignee. (L. 1980
S.B. 644 § 2, A.L. 1983 H.B. 54, A.L. 1986 S.B. 727 merged with H.B. 1554
Revision, A.L. 1991 H.B. 294 & 405, H.B. 608, A.L. 1992 S.B. 661 & 620,
A.L. 1993 H.B. 566, A.L. 1995 H.B. 414, A.L. 1996 H.B. 1237, A.L. 1998
H.B. 1656 merged with S.B. 827)

Effective 8-28-98 (S.B. 827) 1-1-99 (H.B. 1656)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

The right to receive the tax credits described in section
135.110 shall vest in the taxpayer upon commencement of operations of the
revenue-producing enterprise, but the taxpayer shall waive such vested
right for any given year in which the taxpayer fails to meet the terms
and conditions of sections 135.100 to 135.150. Representations made by
the department of economic development and relied upon in good faith by
the taxpayer shall be binding upon the state of Missouri to the extent
such representations are consistent with the provisions of this chapter.
The provisions of this section shall apply to all revenue-producing
enterprises which are eligible for incentives pursuant to this section
and which commenced operations on or after January 1, 1990, to the extent
such incentives do not exceed the ten-year limitation set forth in
subsection 1 of section 135.110. (L. 1999 H.B. 701)

A taxpayer entitled to the credit allowed by section 135.110 may
elect to defer the commencement of the ten-year period during which such
credit is allowed to any taxable year not later than the third taxable
year following the taxable year in which commencement of commercial
operations at the new business facility occurs. The taxpayer shall
perfect such election by notifying the director of economic development,
by a written statement attached to the tax credit application for the
taxable year in which commencement of commercial operations at the new
business facility occurs, of the intention to make such election. The
election shall be made during the taxable year immediately following the
taxable year in which commencement of commercial operations occurs at
such new business facility. Once such election has been perfected, the
credit shall be allowed for the taxable year specified in such election
and for each of the nine succeeding taxable years. (L. 1980 S.B. 644 § 3,
A.L. 1991 H.B. 294 & 405)

1. If a taxpayer, hereafter referred to in this section as
"transferor", shall have established a new business facility and, prior
to the expiration of the ten-year period during which the credit allowed
by section 135.110 may be claimed by the transferor, all or a portion of
such new business facility is acquired by, or leased to, any other
taxpayer, hereafter referred to in this section as "transferee", the
transferor shall allow the transferee to claim such credit as provided in
subsection 2 of this section.

2. If all or a portion of the new business facility is acquired by, or
leased to, the transferee, the portion thereof so acquired by, or leased
to, the transferee shall be considered a new business facility in the
hands of the transferee. In such event, the transferee shall be entitled
to a credit, computed in accordance with section 135.110, with respect to
the portion of the new business facility held by it. Such credit shall be
allowed for the remaining portion of the ten-year period during which the
transferor could have claimed such credit if all or a portion of the new
business facility had not been acquired by, or leased to, the transferee.
The portion, if any, of the new business facility retained by the
transferor shall continue to be a new business facility in the hands of
the transferor and it shall be entitled to the credit allowed by section
135.110 for the remaining portion of such ten-year period.

3. The transferor shall notify the director of economic development of
the transferor's intentions to transfer the rights to claim such credit
to the transferee by written statement attached to the tax credit
application for the taxable year in which the new business facility is
acquired by, or leased to, the transferee, setting forth such other
information as the director of economic development may, by rules and
regulations, require.

4. If an individual taxpayer entitled to the credit allowed by section
135.110 shall die prior to the expiration of the ten-year period during
which such taxpayer is entitled to such credit and the new business
facility with respect to which such credit was claimed passes to the
estate of the deceased taxpayer, such estate shall be entitled to a
credit with respect to such new business facility, and upon distribution
of the new business facility, or a portion thereof, to a distributee of
such estate the credit with respect to such new business facility, or
portion thereof, such distributee shall be entitled to a credit with
respect to such new business facility or portion thereof. (L. 1980 S.B.
644 § 4, A.L. 1991 H.B. 294 & 405)

If a taxpayer has terminated the operation of a revenue
producing enterprise at a new business facility prior to the expiration
of the ten-year period during which a credit is allowed under sections
135.100 to 135.160, and later resumes the operation of the same or a
different revenue producing enterprise at such new business facility, the
taxpayer may, with the consent of the director of economic development,
elect to claim a credit, upon resuming the operation of a revenue
producing enterprise at such new business facility, computed in
accordance with section 135.110 but for a number of years following
resumption of such operations equal to ten reduced by the number of years
for which the credit was claimed prior to termination of operation of
such revenue producing enterprise. The director of economic development
shall grant such consent if it is determined that the termination of
operations was due to reasonable cause and that the resumption of
operations of a revenue producing enterprise at such new business
facility will provide increased opportunities for employment and result
in a substantial contribution to the economy of the state. (L. 1980 S.B.
644 § 5, A.L. 1986 S.B. 727)

1. Until January 1, 1987, the director of revenue shall
prescribe such rules and regulations necessary to carry out the
provisions of sections 135.100 to 135.150.

2. Beginning January 1, 1987, the director of economic development shall
prescribe the method for submitting applications for claiming the tax
credits allowed in subsections 2 and 3 of section 135.110 and shall, if
such application or portion thereof is approved, certify same to the
director of revenue or the director of insurance that the taxpayer
claiming the credits has satisfied all requirements prescribed in
sections 135.100 to 135.150 and is therefore eligible to claim the
credits. The director of economic development shall also calculate and
specify the amount of the credit earned by the taxpayer during the
taxpayer's first taxable year in which such credits are claimed and for
each of the nine succeeding taxable years the credits are claimed by the
taxpayer and shall certify such amounts to the director of revenue or the
director of insurance and shall notify the taxpayer in writing of the
action taken on his request for the credits and if the request for
credits is disallowed, the director of economic development shall state
the reason or reasons the claim for credit was disallowed. The director
shall certify the extent to which earned credits can be claimed to the
director of revenue or the director of insurance and shall notify the
taxpayer in writing of such determination. The director of economic
development may prescribe such rules and regulations necessary to carry
out the provisions of sections 135.100 to 135.150.

3. The director of revenue and, when appropriate, the director of
insurance may prescribe rules and regulations necessary to process the
credits following certification by the director of economic development.
No rule or portion of a rule promulgated under the authority of sections
135.100 to 135.160* shall become effective unless it has been promulgated
pursuant to the provisions of section 536.024, RSMo.

4. Any taxpayer who has submitted an application for claiming tax credits
as allowed in section 135.110 may file with the director of economic
development, a protest within sixty days (one hundred fifty days if the
taxpayer is outside the United States) after the date of such
certification notice or the date of the notice denying such
certification. The protest shall be in writing and shall set forth the
grounds on which the protest is based.

5. If a protest is filed, the director of economic development shall
consider the taxpayer's grounds for protest and make a determination
concerning such protest. The director of economic development shall
notify the taxpayer in writing of such determination within thirty days
following the date on which the written protest was received. Such notice
shall be mailed to the taxpayer by certified or registered mail and such
notice shall set forth briefly the director of economic development's
findings of fact and the basis of decision.

6. The decision of the director of economic development on the taxpayer's
protest is final upon the expiration of thirty days from the date when he
mails notice of his action to the taxpayer unless within this period, the
taxpayer seeks review of the director of economic development's
determination by the administrative hearing commission, which is hereby
authorized. (L. 1980 S.B. 644 § 6, A.L. 1986 S.B. 727, A.L. 1991 H.B. 294
& 405, A.L. 1993 H.B. 566 merged with S.B. 52, A.L. 1995 S.B. 3)

*Section 135.160 was repealed by H.B. 294 & 405 § A, 1991.

Notwithstanding any provision of the law to the contrary, no
revenue-producing enterprise shall receive the incentives set forth in
sections 135.100 to 135.150 for facilities commencing operations on or
after January 1, 2005. (L. 2004 S.B. 1155)

The following terms, whenever used in sections 135.200 to
135.256, mean:

(1) "Department", the department of economic development;

(2) "Director", the director of the department of economic development;

(3) "Facility", any building used as a revenue-producing enterprise
located within an enterprise zone, including the land on which the
facility is located and all machinery, equipment and other real and
depreciable tangible personal property acquired for use at and located at
or within such facility and used in connection with the operation of such
facility;

(4) "Governing authority", the body holding primary legislative authority
over a county or incorporated municipality;

(5) "New business facility" shall have the meaning defined in section
135.100, except that the term "lease" as used therein shall not include
the leasing of property defined in paragraph (d) of subdivision (6) of
this section;

(6) "Revenue-producing enterprise", means:

(a) Manufacturing activities classified as SICs 20 through 39;

(b) Agricultural activities classified as SIC 025;

(c) Rail transportation terminal activities classified as SIC 4013;

(d) Renting or leasing of residential property to low- and moderate-
income persons as defined in federal law, 42 U.S.C. 5302(a)(20);

(e) Motor freight transportation terminal activities classified as SIC
4231;

(f) Public warehousing and storage activities classified as SICs 422 and
423 except SIC 4221, miniwarehouse warehousing and warehousing
self-storage;

(g) Water transportation terminal activities classified as SIC 4491;

(h) Airports, flying fields, and airport terminal services classified as
SIC 4581;

(i) Wholesale trade activities classified as SICs 50 and 51;

(j) Insurance carriers activities classified as SICs 631, 632 and 633;

(k) Research and development activities classified as SIC 873, except
8733;

(l) Farm implement dealer activities classified as SIC 5999;

(m) Employment agency activities classified as SIC 7361;

(n) Computer programming, data processing and other computer-related
activities classified as SIC 737;

(o) Health service activities classified as SICs 801, 802, 803, 804, 806,
807, 8092 and 8093;

(p) Interexchange telecommunications as defined in subdivision (20) of
section 386.020, RSMo, or training activities conducted by an
interexchange telecommunications company as defined in subdivision (19)
of section 386.020, RSMo;

(q) Recycling activities classified as SIC 5093;

(r) Banking activities classified as SICs 602 and 603;

(s) Office activities as defined in subdivision (8) of section 135.100,
notwithstanding SIC classification;

(t) Mining activities classified as SICs 10 through 14;

(u) The administrative management of any of the foregoing activities; or

(v) Any combination of any of the foregoing activities;

(7) "Satellite zone", a noncontiguous addition to an existing state
designated enterprise zone;

(8) "SIC", the standard industrial classification as such classifications
are defined in the 1987 edition of the Standard Industrial Classification
Manual as prepared by the Executive Office of the President, Office of
Management and Budget. (L. 1982 H.B. 1713, et al. § 2, A.L. 1983 H.B.
559, A.L. 1985 H.B. 416, A.L. 1986 S.B. 727, A.L. 1989 S.B. 59, A.L. 1991
H.B. 294 & 405, A.L. 1994 H.B. 1248 & 1048, A.L. 1995 H.B. 414, A.L. 1997
2d Ex. Sess. S.B. 1, A.L. 1998 H.B. 1656, A.L. 1999 H.B. 701)

*Three versions of this section are printed here due to technical
drafting errors.

For purposes of sections 135.200 to 135.256, an area must meet
all the following criteria in order to qualify as an enterprise zone:

(1) The area is one of pervasive poverty, unemployment, and general
distress;

(2) At least sixty-five percent of the residents living in the area have
incomes below eighty percent of the median income of all residents within
the state of Missouri according to the last decennial census or other
appropriate source as approved by the director;

(3) The resident population of the area must be at least four thousand
but not more than seventy-two thousand at the time of designation as an
enterprise zone if the area lies within a metropolitan statistical area,
as established by the United States Census Bureau; or, if the area does
not lie within a metropolitan statistical area, the resident population
of the area at the time of designation must be at least one thousand but
not more than twenty thousand inhabitants. If the population of the
jurisdiction of the governing authority does not meet the minimum
population requirements set forth in this subdivision, the population of
the area must be at least fifty percent of the population of the
jurisdiction; provided, however, no enterprise zone shall be created
which consists of the total area within the political boundaries of a
county; and

(4) The level of unemployment of persons, according to the most recent
data available from the division of employment security or from the
United States Bureau of Census and approved by the director, within the
area exceeds one and one-half times the average rate of unemployment for
the state of Missouri over the previous twelve months, or the percentage
of area residents employed on a full-time basis is less than fifty
percent of the statewide percentage of residents employed on a full-time
basis. (L. 1982 H.B. 1713, et al. § 3, A.L. 1983 H.B. 559, A.L. 1984 H.B.
1611 Revision, A.L. 1995 H.B. 414, A.L. 1999 H.B. 701)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

In addition to the number of enterprise zones authorized by the
provisions of section 135.210, the department of economic development
shall designate one such zone in every county of the third class which
has a population of less than twenty-five thousand inhabitants, and an
assessed valuation of between two hundred and seventy million dollars and
three hundred million dollars as published in the 1985 proceedings of the
Missouri state tax commission. Such designation shall only be made if the
area in the county which is to be included in the enterprise zone meets
all the requirements of section 135.205. (L. 1987 S.B. 421 § 1)

Effective 3-18-87

1. (1) Any city with a population of at least three hundred
fifty thousand inhabitants which is located in more than one county and
any city not within a county, which includes an existing state designated
enterprise zone within the corporate limits of the city, may each, upon
approval of the local governing authority of the city and the director of
the department of economic development, designate up to three satellite
zones within its corporate limits. A prerequisite for the designation of
a satellite zone shall be the approval by the director of a plan
submitted by the local governing authority of the city describing how the
satellite zone corresponds to the city's overall enterprise zone strategy.

(2) Any Missouri community classified as a village whose borders lie
adjacent to a city with a population in excess of three hundred fifty
thousand inhabitants as described in subdivision (1) of this subsection,
and which has within the corporate limits of the village a factory,
mining operation, office, mill, plant or warehouse which has at least
three thousand employees and has an investment in plant, machinery and
equipment of at least two hundred million dollars may, upon securing
approval of the director and the local governing authorities of the
village and the adjacent city which contains an existing state-designated
enterprise zone, designate one satellite zone to be located within the
corporate limits of the village, such zone to be in addition to the six
authorized in subdivision (1) of this subsection.

(3) Any geographical area partially contained within any city not within
a county and partially contained within any county of the first
classification with a charter form of government with a population of
nine hundred thousand or more inhabitants, which area is comprised of a
total population of at least four thousand inhabitants but not more than
seventy-two thousand inhabitants, and which area consists of at least one
fourth class city, and has within its boundaries a military reserve
facility and a utility pumping station having a capacity of ten million
cubic feet, may, upon securing approval of the director and the
appropriate local governing authorities as provided for in section
135.210, be designated as a satellite zone, such zone to be in addition
to the six authorized in subdivision (1) of this subsection.

(4) In addition to all other satellite zones authorized in this section,
any home rule city with more than seventy-three thousand but less than
seventy-five thousand inhabitants, which includes an existing
state-designated enterprise zone within the corporate limits of the city,
may, upon approval of the local governing authority of the city and
director of the department of economic development, designate a satellite
zone within its corporate limits. A prerequisite for the designation of a
satellite zone pursuant to this subdivision shall be the approval by the
director of the department of economic development of a plan submitted by
the local governing authority of such city describing how the satellite
zone corresponds to the city's overall enterprise zone strategy.

(5) In addition to all other satellite zones authorized in this section,
any home rule city with more than one hundred thirteen thousand two
hundred but less than one hundred thirteen thousand three hundred
inhabitants, which includes an existing state-designated enterprise zone
within the corporate limits of the city, may, upon approval of the local
governing authority of the city and director of the department of
economic development, designate a satellite zone within its corporate
limits along the southwest corner of any intersection of two United
States interstate highways. A prerequisite for the designation of a
satellite zone pursuant to this subdivision shall be the approval by the
director of the department of economic development of a plan submitted by
the local governing authority of such city describing how the satellite
zone corresponds to the city's overall enterprise zone strategy.

(6) In addition to all other satellite zones authorized in this section,
any home rule city with more than one hundred fifty-one thousand five
hundred but less than one hundred fifty-one thousand six hundred
inhabitants which includes an existing state-designated enterprise zone
within the corporate limits of the city may, upon approval of the
governing authority of the city and the director of the department of
economic development, designate one satellite zone within its corporate
limits. No satellite zone shall be designated pursuant to this
subdivision until the governing authority of the city submits a plan
describing how the satellite zone corresponds to the city's overall
enterprise zone strategy and the director approves the plan.

(7) In addition to all other satellite zones authorized in this section,
any city of the fourth classification with more than three thousand eight
hundred but less than four thousand inhabitants and located in more than
one county and which city lies adjacent to any home rule city with more
than one hundred thirteen thousand two hundred but less than one hundred
thirteen thousand three hundred inhabitants and which contains an
enterprise zone may, upon approval of the director and the governing
authorities of the city of the fourth classification and the home rule
city, designate one satellite zone within its corporate limits. The
satellite enterprise zone authorized by this subsection shall be
designated only if it meets the criteria established by subsection 2 of
this section. Retail businesses, as identified by the 1997 North American
Industry Classification System (NAICS) sector numbers 44-45, located
within the satellite enterprise zone shall be eligible for all benefits
provided under the provisions of sections 135.200 to 135.258.

2. For satellite zones designated pursuant to the provisions of
subdivisions (1) and (3) of subsection 1 of this section, the satellite
zones, in conjunction with the existing state-designated enterprise zone
shall meet the following criteria:

(1) The area is one of pervasive poverty, unemployment, and general
distress, or one in which a large number of jobs have been lost, a large
number of employers have closed, or in which a large percentage of
available production capacity is idle. For the purpose of this
subdivision, "large number of jobs" means one percent or more of the
area's population according to the most recent decennial census, and
"large number of employers" means over five;

(2) At least fifty percent of the residents living in the area have
incomes below eighty percent of the median income of all residents within
the state of Missouri according to the last decennial census or other
appropriate source as approved by the director;

(3) The resident population of the existing state-designated enterprise
zone and its satellite zones must be at least four thousand but not more
than seventy-two thousand at the time of designation;

(4) The level of unemployment of persons, according to the most recent
data available from the division of employment security or from the
United States Bureau of Census and approved by the director, within the
area exceeds one and one-half times the average rate of unemployment for
the state of Missouri over the previous twelve months, or the percentage
of area residents employed on a full-time basis is less than sixty
percent of the statewide percentage of residents employed on a full-time
basis.

3. A qualified business located within a satellite zone shall be subject
to the same eligibility criteria and can be eligible to receive the same
benefits as a qualified facility in sections 135.200 to 135.258. (L. 1989
S.B. 59, A.L. 1995 H.B. 414, A.L. 1996 H.B. 1237, A.L. 1999 H.B. 701,
A.L. 2003 H.B. 289 merged with S.B. 504, A.L. 2004 S.B. 1155)

1. In addition to the number of enterprise zones authorized
under the provisions of sections 135.206 and 135.210, the department of
economic development shall designate one such zone in any county of the
third class which is south of the Missouri River and which adjoins one
county of the second class and also the state of Oklahoma. Such
designation shall only be made if the area of the county which is to be
included in the enterprise zone meets all the requirements of section
135.205.

2. In addition to the number of enterprise zones authorized under the
provisions of sections 135.206 and 135.210, the department of economic
development shall designate one such zone in any county of the third
class which borders the Missouri River and which adjoins a county of the
second class with a population of at least one hundred thousand
inhabitants and which contains a branch of the state university. Such
designation shall only be made if the area of the county which is to be
included in the enterprise zone meets all the requirements of section
135.205.

3. In addition to the number of enterprise zones authorized under the
provisions of sections 135.206, 135.210 and 135.256, the department of
economic development shall designate one such zone in every county of the
third class without a township form of government with a population of
more than seven thousand eight hundred but less than ten thousand
inhabitants located south of the Missouri River, which adjoins one third
class county with a township form of government, and which adjoins no
first or second class county. Such enterprise zone designation shall only
be made if the area in the county which is to be included in the
enterprise zone meets all the requirements of section 135.205.

4. In addition to the number of enterprise zones authorized pursuant to
the provisions of sections 135.206, 135.210 and 135.256, the department
of economic development shall designate one such zone in a city of the
third class with a population of more than eight thousand but less than
ten thousand located in a county of the third classification with a
township form of government with a population of more than twenty
thousand but less than twenty-two thousand. Such enterprise zone
designation shall only be made if the area in the city which is to be
included in the enterprise zone meets all the requirements of section
135.205.

5. In addition to the number of enterprise zones authorized pursuant to
the provisions of sections 135.206, 135.210 and 135.256, the department
of economic development shall designate one such zone for any city with a
home rule form of government and a population of at least one hundred ten
thousand inhabitants but not more than one hundred thirty thousand
inhabitants. Such enterprise zone designation shall only be made if the
area in the city which is to be included in the enterprise zone meets all
the requirements of section 135.205.

6. In addition to the number of enterprise zones authorized pursuant to
the provisions of sections 135.206, 135.210 and 135.256, the department
of economic development shall designate one such zone for any county of
the first classification without a charter form of government with a
population of less than thirty thousand inhabitants. Such enterprise zone
designation shall only be made if the area in the city which is to be
included in the enterprise zone meets all the requirements of section
135.205.

7. In addition to the number of enterprise zones authorized pursuant to
the provisions of sections 135.206, 135.210, 135.256 and 135.257, the
department of economic development shall designate one such zone in a
city of the fourth classification with a population of at least three
thousand but less than four thousand inhabitants located in a county of
the second classification with a population of at least twenty thousand
but not more than twenty-five thousand inhabitants. Such enterprise zone
designation shall only be made if such area which is to be included in
the enterprise zone meets all the requirements of section 135.205.

8. In addition to the number of enterprise zones authorized pursuant to
the provisions of sections 135.206, 135.210, 135.256 and 135.257, the
department of economic development shall designate one such zone for any
area that includes property in two adjoining counties where one county is
a county of the third classification without a township form of
government with a population of less than sixteen thousand three hundred
and more than sixteen thousand inhabitants and the other county is a
county of the first classification having a population of at least one
hundred seventy-one thousand but less than one hundred seventy-two
thousand inhabitants. Such enterprise zone designation shall only be made
if such area which is to be included in the enterprise zone meets all the
requirements of section 135.205.

9. In addition to the number of enterprise zones authorized pursuant to
the provisions of sections 135.206, 135.210 and 135.256, the department
of economic development shall designate one such zone in a city of the
fourth class with a population of more than four thousand located in a
county of the third classification with a township form of government and
with a population of less than thirteen thousand. Such enterprise zone
designation shall only be made if the area in the city which is to be
included in the enterprise zone meets all the requirements of section
135.205.

10. In addition to the number of enterprise zones authorized pursuant to
the provisions of sections 135.206, 135.210 and 135.256, the department
of economic development shall designate one such zone in a city of the
fourth class with a population of more than two thousand nine hundred
located in a county of the third classification without a township form
of government with a population of less than twelve thousand and more
than eleven thousand seven hundred inhabitants. Such enterprise zone
designation shall only be made if the area in the city which is to be
included in the enterprise zone meets all the requirements of section
135.205.

11. In addition to the number of enterprise zones authorized pursuant to
the provisions of sections 135.206, 135.210 and 135.256, the department
of economic development shall designate one such zone in a county of the
third classification without a township form of government with a
population of less than twenty-four thousand five hundred and more than
twenty-four thousand inhabitants. Such enterprise zone designation shall
only be made if the area in the county which is to be included in the
enterprise zone meets all the requirements of section 135.205. (L. 1990
H.B. 1564 §§ 5, 6, 7, A.L. 1997 2d Ex. Sess. S.B. 1, A.L. 1998 S.B. 827,
A.L. 1999 H.B. 701)

1. Any city in which an enterprise zone is designated pursuant
to subsection 5 of section 135.208 may, upon approval of the local
governing authority of the city and the director of the department of
economic development, designate one satellite enterprise zone within its
corporate limits. A prerequisite for the designation of the satellite
zone shall be the approval by the director of the department of economic
development of a plan submitted by the local governing authority of the
city describing how the satellite zone corresponds to the city's overall
enterprise zone strategy.

2. The satellite enterprise zone authorized by this section shall be
designated only if it meets the criteria established by subdivisions (1)
to (4) of subsection 2 of section 135.207. Retail businesses, as
identified by the 1997 North American Industry Classification System
(NAICS) sector numbers 44 to 45, located within the satellite enterprise
zone shall be eligible for all benefits provided pursuant to the
provisions of sections 135.200 to 135.258. (L. 1999 H.B. 701)

1. Any governing authority which desires to have any portion of
a city or unincorporated area of a county under its control designated as
an enterprise zone shall hold a public hearing for the purpose of
obtaining the opinion and suggestions of those persons who will be
affected by such designation. The governing authority shall notify the
director of such hearing at least thirty days prior thereto and shall
publish notice of such hearing in a newspaper of general circulation in
the area to be affected by such designation at least twenty days prior to
the date of the hearing but not more than thirty days prior to such
hearing. Such notice shall state the time, location, date and purpose of
the hearing. The director, or the director's designee, shall attend such
hearing.

2. After a public hearing is held as required in subsection 1 of this
section, the governing authority may file a petition with the department
requesting the designation of a specific area as an enterprise zone. Such
petition shall include, in addition to a description of the physical,
social, and economic characteristics of the area:

(1) A plan to provide adequate police protection within the area;

(2) A specific and practical process for individual businesses to obtain
waivers from burdensome local regulations, ordinances, and orders which
serve to discourage economic development within the area to be designated
an enterprise zone; except that, such waivers shall not substantially
endanger the health or safety of the employees of any such business or
the residents of the area;

(3) A description of what other specific actions will be taken to support
and encourage private investment within the area;

(4) A plan to ensure that resources are available to assist area
residents to participate in increased development through self-help
efforts and in ameliorating any negative effects of designation of the
area as an enterprise zone;

(5) A statement describing the projected positive and negative effects of
designation of the area as an enterprise zone; and

(6) A specific plan to provide assistance to any person or business
dislocated as a result of activities within the zone. Such plan shall
determine the need of dislocated persons for relocation assistance;
provide, prior to displacement, information about the type, location and
price of comparable housing or commercial property; provide information
concerning state and federal programs for relocation assistance and
provide other advisory services to displaced persons. Public agencies may
choose to provide assistance under the Uniform Relocation and Real
Property Acquisition Act, 42 U.S.C. section 4601, et seq. to meet the
requirements of this subdivision.

3. Notwithstanding the provisions of section 135.250, the director of the
department of economic development shall, prior to the designation of any
enterprise zone, submit to the joint committee on economic development
policy and planning, established in section 620.602, RSMo, rules and
regulations pertaining to the designation of enterprise zones. Following
approval by the joint committee, such rules and regulations shall be
issued pursuant to the provisions of section 536.021, RSMo. Upon approval
of an enterprise zone designation by the department, the director shall
submit such enterprise zone designation to the joint committee for its
approval. An enterprise zone designation shall be effective upon such
approval by the joint committee. The director shall report annually to
the joint committee the number and location of all enterprise zones
designated, together with the business activity within each designated
enterprise zone.

4. No more than fifty such areas may be designated by the director as an
enterprise zone under the provisions of this subsection, except that any
enterprise zones authorized apart from this subsection by specific
legislative enactment, on or after August 28, 1991, shall not be counted
toward the limitation set forth in this subsection. After fifty
enterprise zones, plus any others authorized apart from this subsection
by specific legislative enactment first designated on or after August 28,
1991, have been designated by the director, additional enterprise zones
may be authorized apart from this subsection by specific legislative
enactment, except that if an enterprise zone designation is canceled
under the provision of subsection 5 of this section, the director may
designate one area as an enterprise zone for each enterprise zone
designation which is canceled.

5. Each designated enterprise zone or satellite zone must report to the
director on an annual basis regarding the status of the zone and business
activity within the zone. On the fifth anniversary of the designation of
each zone after August 8, 1989, and each five years thereafter, the
director shall evaluate the activity which has occurred within the zone
during the previous five-year period, including business investments and
the creation of new jobs. The director shall present the director's
evaluation to the joint legislative committee on economic development
policy and planning. If the director finds that the plan outlined in the
application for designation was not implemented in good faith, or if such
zone no longer qualifies under the original criteria, or if the director
finds that the zone is not being effectively promoted or developed, the
director may recommend to the committee that the designation of that area
as an enterprise zone be canceled. All agreements negotiated under the
benefits of such zone shall remain in effect for the originally agreed
upon duration. The committee shall schedule a hearing on such
recommendation for not later than sixty days after the recommendation is
filed with it. At the hearing, interested parties, including the
director, may present witnesses and evidence as to why the enterprise
zone designation for that particular area should be continued or
canceled. Within thirty days after the hearing the committee shall
determine whether or not the designation should be continued. If it is
not continued, the director shall remove the designation from the area
and, following the procedures outlined in this section, award the
designation of an enterprise zone to another applicant. If an area has
requested a designated enterprise zone, and met all existing statutory
requirements, but has not been designated such, then the applicant may
appeal to the joint legislative committee on economic development policy
and planning for a hearing to determine its eligibility for such a
designation. The review of the director's evaluation and the hearing
thereon, and any appeal as provided for in this subsection, by the joint
legislative committee on economic development policy and planning shall
be an additional duty for that body. (L. 1982 H.B. 1713, et al. § 4, A.L.
1983 H.B. 559, A.L. 1985 H.B. 416, A.L. 1986 S.B. 727, A.L. 1989 S.B. 59,
A.L. 1991 H.B. 294 & 405 merged with S.B. 289, A.L. 1995 H.B. 414)

Effective 1-1-96

1. In addition to any other enterprise zones authorized in this
chapter, the department of economic development shall designate one
enterprise zone in any county of the third classification without a
township form of government and with more than thirty-two thousand five
hundred but less than thirty-two thousand six hundred inhabitants. Such
enterprise zone designations shall have the same boundaries as such
county, and shall only be made if the area to be included in the
enterprise zone meets all the requirements of section 135.205.

2. In addition to any other enterprise zones authorized in this chapter,
the department of economic development shall designate one enterprise
zone that shall have boundaries that are the same as any city of the
fourth classification with more than one thousand eight hundred but less
than one thousand nine hundred inhabitants and located in three counties.
Such enterprise zone designation shall only be made if the area that is
to be included in the enterprise zone meets all the requirements of
section 135.205.

3. In addition to any other enterprise zones authorized in this chapter,
the department of economic development shall designate one enterprise
zone that shall have boundaries that are the same as any city of the
fourth classification with more than one thousand but less than one
thousand one hundred inhabitants and located in any county of the third
classification without a township form of government and with more than
forty-one thousand one hundred but less than forty-one thousand two
hundred inhabitants. Such enterprise zone designation shall only be made
if the area that is to be included in the enterprise zone meets all the
requirements of section 135.205.

4. In addition to any other enterprise zones authorized pursuant to this
chapter, the department of economic development shall designate one
enterprise zone that shall have boundaries that are the same as any
county of the third classification without a township form of government
and with more than thirteen thousand seventy-five but less than thirteen
thousand one hundred seventy-five inhabitants. Such enterprise zone
designation shall only be made if the area that is to be included in the
enterprise zone meets all the requirements of section 135.205.

5. In addition to any other enterprise zones authorized in this chapter,
the department of economic development shall designate one enterprise
zone in the portions of any city of the fourth classification with more
than three thousand eight hundred but less than four thousand inhabitants
and located in more than one county and any home rule city with more than
one hundred thirteen thousand two hundred but less than one hundred
thirteen thousand three hundred inhabitants which include a political
subdivision that receives a portion of its funding from section 163.031,
RSMo, and is located in part in any home rule city with more than four
hundred thousand inhabitants and located in more than one county. Such
enterprise zone shall only be made if the area to be included in the
enterprise zone meets all the requirements of section 135.205.

6. In addition to any other enterprise zones authorized pursuant to this
chapter, the department of economic development shall designate one
enterprise zone that shall have boundaries that are the same as any city
of the fourth classification with more than four thousand three hundred
but less than four thousand five hundred located in a county of the first
classification with more than ninety-three thousand eight hundred but
less than ninety-three thousand nine hundred inhabitants. Such enterprise
zone designation shall only be made if the area that is to be included in
the enterprise zone meets all the requirements of section 135.205.

7. In addition to any other enterprise zones authorized pursuant to this
chapter, the department of economic development shall designate one
enterprise zone that shall have boundaries that are the same as any city
of the fourth classification with more than five thousand four hundred
but less than five thousand five hundred inhabitants and located in more
than one county. Such enterprise zone designation shall only be made if
the area that is to be included in the enterprise zone meets all the
requirements of section 135.205.

8. In addition to any other enterprise zones authorized in this chapter,
the department of economic development shall designate one enterprise
zone that shall be located partially in any city of the fourth
classification with more than twelve thousand one hundred but less than
twelve thousand four hundred inhabitants and partially in any city of the
fourth classification with more than nine thousand six hundred but less
than nine thousand seven hundred inhabitants and shall include all area
in between any city of the fourth classification with more than twelve
thousand one hundred but less than twelve thousand four hundred
inhabitants and any city of the fourth classification with more than nine
thousand six hundred but less than nine thousand seven hundred
inhabitants with specific boundaries to be determined by the department
of economic development in conjunction with the governing authority of
the county. Such enterprise zone designation shall only be made if the
area that is to be included in the enterprise zone meets all the
requirements of section 135.205.

9. In addition to any other enterprise zones authorized in this chapter,
the department of economic development shall designate one enterprise
zone within any county of the third classification without a township
form of government and with more than thirty-one thousand but less than
thirty-one thousand one hundred inhabitants. Such enterprise zone
designation shall only be made if the area that is to be included in the
enterprise zone meets all the requirements of section 135.205.

10. Notwithstanding the provisions of section 135.230 to the contrary,
any enterprise zone designated in any county of the third classification
with a township form of government and with more than thirteen thousand
seven hundred but less than thirteen thousand eight hundred inhabitants
or designated in any county of the third classification without a
township form of government and with more than fifteen thousand seven
hundred but less than fifteen thousand eight hundred inhabitants shall
not expire before December 31, 2015.

11. In addition to the number of enterprise zones authorized by the
provisions of sections 135.200 to 135.270, the department of economic
development shall designate one such zone in every county of the third
classification without a township form of government and with more than
six thousand seven hundred fifty but less than six thousand eight hundred
fifty inhabitants. Such designation shall only be made if the area in the
county which is to be included in the enterprise zone meets all the
requirements of section 135.205.

12. In addition to the number of enterprise zones authorized by the
provisions of this chapter the department of economic development shall
designate one such zone in every city of the fourth classification with
more than thirteen thousand six hundred but less than thirteen thousand
eight hundred inhabitants which shall have boundaries abutting an
international airport and an interstate highway with specific boundaries
to be determined by the department of economic development in conjunction
with the governing authority of the city. Such designation shall only be
made if the area in the city which is to be included in the enterprise
zone meets all the requirements of section 135.205.

13. In addition to any other enterprise zones authorized in this chapter,
the department of economic development shall designate one such zone in a
city of the fourth classification with more than thirty thousand three
hundred but less than thirty thousand seven hundred inhabitants. Such
enterprise zone shall only be made if the area to be included in the
enterprise zone meets all the requirements of section 135.205. (L. 2004
S.B. 1155)

*Section includes Laclede County, Richland, Crocker, Douglas County,
Sugar Creek, Independence, St. Clair, Pacific, Nixa, Ozark, the area
between Nixa and Ozark, Webster County, Linn County, Macon County, Shelby
County, St. Ann, and Raytown.

1. Improvements made to "real property" as such term is defined
in section 137.010, RSMo, which are made in an enterprise zone subsequent
to the date such zone or expansion thereto was designated, may upon
approval of an authorizing resolution by the governing authority having
jurisdiction of the area in which the improvements are made, be exempt,
in whole or in part, from assessment and payment of ad valorem taxes of
one or more affected political subdivisions, provided that, except as to
the exemption allowed under subsection 3 of this section, at least fifty
new jobs that provide an average of at least thirty-five hours of
employment per week per job are created and maintained at the new or
expanded facility. Such authorizing resolution shall specify the percent
of the exemption to be granted, the duration of the exemption to be
granted, and the political subdivisions to which such exemption is to
apply and any other terms, conditions or stipulations otherwise required.
A copy of the resolution shall be provided the director within thirty
calendar days following adoption of the resolution by the governing
authority.

2. No exemption shall be granted until the governing authority holds a
public hearing for the purpose of obtaining the opinions and suggestions
of residents of political subdivisions to be affected by the exemption
from property taxes. The governing authority shall send, by certified
mail, a notice of such hearing to each political subdivision in the area
to be affected and shall publish notice of such hearing in a newspaper of
general circulation in the area to be affected by the exemption at least
twenty days prior to the hearing but not more than thirty days prior to
the hearing. Such notice shall state the time, location, date and purpose
of the hearing.

3. Notwithstanding subsection 1 of this section, at least one-half of the
ad valorem taxes otherwise imposed on subsequent improvements to real
property located in an enterprise zone shall become and remain exempt
from assessment and payment of ad valorem taxes of any political
subdivision of this state or municipality thereof for a period of not
less than ten years following the date such improvements were assessed,
provided the improved properties are used for assembling, fabricating,
processing, manufacturing, mining, warehousing or distributing properties.

4. No exemption shall be granted for a period more than twenty-five years
following the date on which the original enterprise zone was designated
by the department except for any enterprise zone within any home rule
city with more than one hundred fifty-one thousand five hundred but less
than one hundred fifty-one thousand six hundred inhabitants provided in
any instance the exemption shall not be granted for a period longer than
twenty-five years from the date on which the exemption was granted.

5. The provisions of subsection 1 of this section shall not apply to
improvements made to real property which have been started prior to
August 28, 1991.

6. The mandatory abatement referred to in this section shall not relieve
the assessor or other responsible official from ascertaining the amount
of the equalized assessed value of all taxable property annually as
required by section 99.855, RSMo, and shall not have the effect of
reducing the payments in lieu of taxes referred to in subdivision (2) of
section 99.845, RSMo, unless such reduction is set forth in the plan
approved by the governing body of the municipality pursuant to
subdivision (1) of section 99.820, RSMo.

7. Effective August 28, 2004, any abatement or exemption provided for in
this section on an individual parcel of real property shall cease after a
period of thirty days of business closure, work stoppage, major reduction
in force, or a significant change in the type of business conducted at
that location. For the purposes of this subsection, "work stoppage" shall
not include strike or lockout or time necessary to retool a plant, and
"major reduction in force" is defined as a seventy-five percent or
greater reduction. Any owner or new owner may reapply, but cannot receive
the abatement or exemption for any period of time beyond the original
life of the enterprise zone. (L. 1982 H.B. 1713, et al. § 5, A.L. 1983
H.B. 559, A.L. 1986 S.B. 727, A.L. 1991 H.B. 294 & 405, A.L. 1992 S.B.
661 & 620, A.L. 1994 H.B. 1248 & 1048, A.L. 1995 H.B. 414, A.L. 2004 S.B.
1099 merged with S.B. 1155)

1. The provisions of chapter 143, RSMo, notwithstanding,
one-half of the Missouri taxable income attributed to a new business
facility in an enterprise zone which is earned by a taxpayer establishing
and operating a new business facility located within an enterprise zone
shall be exempt from taxation under chapter 143, RSMo. A taxpayer
operating a revenue producing enterprise as defined in paragraph (d) of
subdivision (6) of section 135.200 may elect to exempt from taxation
under chapter 143, RSMo, one-half of the Missouri taxable income
attributed to a new business facility in an enterprise zone or may elect
to claim a fifty-dollar credit against the tax imposed under chapter 143,
RSMo, excluding withholding tax imposed by sections 143.191 to 143.265,
RSMo, for each room constructed for use as a bedroom for each qualifying
residential unit. A "bedroom" is defined as a structurally separate room
used primarily for sleeping, and not as a living room, dining room,
kitchen or closet. That portion of income attributed to the new business
facility shall be determined in a manner prescribed in paragraph (b) of
subdivision (6) of section 135.100, except that compensation paid to
truck drivers, or rail or barge vehicle operators shall be excluded from
the fraction.

2. In the case of a small corporation described in section 143.471, RSMo,
or a partnership, in computing the Missouri taxable income of the
taxpayers described in subdivisions (1) and (2) of this subsection, a
deduction apportioned in proportion to their share of ownership of the
business on the last day of the taxpayer's tax period for which such tax
credits are being claimed, shall be allowed from their Missouri adjusted
gross income in the amount of one-half of the Missouri taxable income
earned by the new business facility, as determined by the method
prescribed in subsection 1 of this section located within the enterprise
zone, as defined in this section, to the following:

(1) The shareholders of a small corporation described in section 143.471,
RSMo;

(2) The partners in a partnership. (L. 1982 H.B. 1713, et al. § 6, A.L.
1983 H.B. 559, A.L. 1986 S.B. 727, A.L. 1991 H.B. 294 & 405, A.L. 1992
S.B. 661 & 620, A.L. 1994 H.B. 1248 & 1048)

1. The credits otherwise provided by sections 135.100 to 135.150
shall upon proper application be granted to any taxpayer who shall
establish and operate a new business facility located within an
enterprise zone, except one designated pursuant to subsection 5 of
section 135.230, on the same terms and conditions specified in those
sections, except that:

(1) The credit otherwise allowed for each new business facility employee
employed within an enterprise zone shall be four hundred dollars;

(2) An additional credit of four hundred dollars shall be granted for
each twelve-month period that a new business facility employee is a
resident of an enterprise zone;

(3) An additional credit of four hundred dollars shall be granted for
each twelve-month period that the person employed as a new business
facility employee is a person who, at the time of such employment by the
new business facility, met the criteria as set forth in section 135.240;

(4) The credit otherwise allowed for new business facility investment
shall be equal to the sum of ten percent of the first ten thousand
dollars of such qualifying investment, plus five percent of the next
ninety thousand dollars of such qualifying investment, plus two percent
of all remaining qualifying investments within an enterprise zone;

(5) In the case of a small corporation described in section 143.471,
RSMo, or a partnership, the credits granted by this section shall be
apportioned in proportion to the share of ownership of the taxpayer on
the last day of the taxpayer's tax period for which such tax credits are
being claimed, to the following:

(a) The shareholders of a small corporation described in section 143.471,
RSMo;

(b) The partners in a partnership;

(6) In the case of financial institutions described pursuant to the
provisions of chapter 148, RSMo, the credits allowed in subdivisions (1),
(2), (3) and (4) of this subsection and the credit allowed in section
135.235 may be used to offset the tax imposed by chapter 148, RSMo, and,
in the case of an insurance company exempt from the thirty-percent
employee requirement of section 135.230, any obligations imposed pursuant
to section 375.916, RSMo, subject to the same method of apportionment as
prescribed for taxes imposed by chapter 143, RSMo, and as provided in
subdivision (6) of section 135.100 and subsections 2 and 3 of section
135.110;

(7) If a facility within an enterprise zone, which does not constitute a
new business facility, is expanded or improved by the taxpayer within the
enterprise zone, the expansion or improvement shall be considered a
separate facility eligible for the credits allowed in this section and
section 135.235, and the exemption allowed in section 135.220, if:

(a) The new business facility investment in the expansion or improvement
during the tax period in which such credits and the exemption are claimed
exceeds one hundred thousand dollars or, if less than one hundred
thousand dollars, is twenty-five percent of the investment in the
original facility prior to expansion or improvement; and

(b) The expansion or improvement otherwise constitutes a new business
facility; and

(c) The number of new business facility employees engaged or maintained
in employment at the expanded or improved facility for the taxable year
for which the credit is claimed equals or exceeds two and the total
number of employees at the facility after expansion or improvement is at
least two greater than the total number of employees before expansion or
improvement. The taxpayer's investment in the expansion or improvement
and in the original facility prior to expansion or improvement shall be
determined in the manner provided in subdivision (7) of section 135.100;

(8) For the purpose of sections 135.200 to 135.256, an office as defined
in subdivision (8) of section 135.100, when established, must create and
maintain at least two new business facility employees as defined in
subdivision (5) of section 135.100;

(9) In the case where a person employed by the new business facility is a
resident of the enterprise zone for less than a twelve-month period, or
in the case where a person employed as a new business facility employee
is a person who, at the time of such employment by the new business
facility, met the criteria as set forth in section 135.240, is employed
for less than a twelve-month period, the credits allowed by subdivisions
(2) and (3) of this subsection shall be determined by multiplying four
hundred dollars by a fraction, the numerator of which is the number of
calendar days during the taxpayer's tax year for which such credits are
claimed, in which the person met the requirements prescribed in
subdivision (2) or (3) of this subsection, and the denominator of which
is three hundred and sixty-five, except that such credit shall not exceed
four hundred dollars per employee in any one taxable year;

(10) The deferment of tax credit authorized in section 135.120 shall not
be available to taxpayers establishing a new business facility in an
enterprise zone;

(11) The allowance for additional ten-year periods to certain new
business facilities as prescribed in subsection 1 of section 135.110
shall not be available to taxpayers expanding a new business facility in
an enterprise zone, except that any taxpayer who has been eligible to
earn enterprise zone tax benefits for ten tax periods, or until the
expiration of the fifteen-year period as prescribed in subsection 1 of
section 135.230, or for the maximum period otherwise allowed by law, may
qualify for the tax credits allowed in section 135.110 if otherwise
eligible, pursuant to the same terms and conditions prescribed in
sections 135.100 to 135.150;

(12) Taxpayers who establish a new business facility by operating a
revenue-producing enterprise as defined in paragraph (d) of subdivision
(6) of section 135.200 shall not be required to create and maintain new
business facility employees.

2. The tax credits described in subdivisions (1), (2), (3) and (4) of
subsection 1 of this section, the training credit allowed in section
135.235, and the income exemption allowed in section 135.220, shall be
allowed to any taxpayer, under the same terms and conditions specified in
such sections, who establishes a new business facility in an enterprise
zone designated pursuant to subsection 5 of section 135.230, except that
all such tax benefits shall be removed not later than seven years after
the enterprise zone is designated as such.

3. Notwithstanding any provision of law to the contrary, any taxpayer who
establishes a new business facility in an enterprise zone, may elect to
forfeit the tax credits otherwise allowed in section 135.235 and this
section and the exemptions otherwise allowed in sections 135.215 and
135.220 and the refund otherwise allowed in section 135.245, and in lieu
thereof, claim the tax credits allowed in section 135.110, pursuant to
the same terms and conditions prescribed in sections 135.100 to 135.150.
To perfect the election, the taxpayer shall attach written notification
of such election to the taxpayer's initial application for claiming tax
credits. The election shall be irreversible once perfected.

4. The right to receive the income exemption described in section
135.220, the tax credits described in subsection 1 of this section and
the training credit allowed in section 135.235 shall vest in the taxpayer
upon commencement of operations of the revenue-producing enterprise, but
such vested right shall be waived by the taxpayer for any given year in
which the terms and conditions of sections 135.100 to 135.268 are not
met. Representations made by the department and relied upon in good faith
by the taxpayer shall be binding upon the state of Missouri insofar as
they are consistent with the provisions of this chapter. The provisions
of this subsection shall apply to all revenue-producing enterprises which
are eligible for incentives pursuant to this subsection and which
commenced operation on or after January 1, 1996, to the extent such
incentives do not exceed the fifteen-year limitation pursuant to
subsection 1 of section 135.230 or the seven-year limitation pursuant to
subsection 5 of section 135.230. The provisions of this subsection shall
apply to all revenue- producing enterprises which are eligible for the
incentives set forth in this subsection, and which began operation after
January 1, 1996, to the extent such incentives do not exceed the
fifteen-year limitation set forth in subsection 1 of section 135.230, or
the seven-year limit set forth in subsection 5 of section 135.230. (L.
1982 H.B. 1713, et al. § 7, A.L. 1983 H.B. 559, A.L. 1986 S.B. 727, A.L.
1991 H.B. 294 & 405, A.L. 1992 S.B. 661 & 620, A.L. 1994 H.B. 1248 &
1048, A.L. 1995 H.B. 414, A.L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess.
S.B. 1, A.L. 1999 H.B. 701)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

1. The exemption or credit established and allowed by section
135.220 and the credits allowed and established by subdivisions (1), (2),
(3) and (4) of subsection 1 of section 135.225 shall be granted with
respect to any new business facility located within an enterprise zone
for a vested period not to exceed ten years following the date upon which
the new business facility commences operation within the enterprise zone
and such exemption shall be calculated, for each succeeding year of
eligibility, in accordance with the formulas applied in the initial year
in which the new business facility is certified as such, subject,
however, to the limitation that all such credits allowed in sections
135.225 and 135.235 and the exemption allowed in section 135.220 shall be
removed not later than fifteen years after the enterprise zone is
designated as such. No credits shall be allowed pursuant to subdivision
(1), (2), (3) or (4) of subsection 1 of section 135.225 or section
135.235 and no exemption shall be allowed pursuant to section 135.220
unless the number of new business facility employees engaged or
maintained in employment at the new business facility for the taxable
year for which the credit is claimed equals or exceeds two or the new
business facility is a revenue-producing enterprise as defined in
paragraph (d) of subdivision (6) of section 135.200. In order to qualify
for either the exemption pursuant to section 135.220 or the credit
pursuant to subdivision (4) of subsection 1 of section 135.225, or both,
it shall be required that at least thirty percent of new business
facility employees, as determined by subsection 4 of section 135.110,
meet the criteria established in section 135.240 or are residents of an
enterprise zone or some combination thereof, except taxpayers who
establish a new business facility by operating a revenue-producing
enterprise as defined in paragraph (d) of subdivision (6) of section
135.200 or any taxpayer that is an insurance company that established a
new business facility satisfying the requirements of subdivision (8) of
section 135.100 located within an enterprise zone after June 30, 1993,
and before December 31, 1994, and that employs in excess of three hundred
fifty new business facility employees at such facility each tax period
for which the credits allowable pursuant to subdivisions (1) to (4) of
subsection 1 of section 135.225 are claimed shall not be required to meet
such requirement. A new business facility described as SIC 3751 shall be
required to employ fifteen percent of such employees instead of the
required thirty percent. For the purpose of satisfying the thirty-percent
requirement, residents must have lived in the enterprise zone for a
period of at least one full calendar month and must have been employed at
the new business facility for at least one full calendar month, and
persons qualifying because they meet the requirements of section 135.240
must have satisfied such requirement at the time they were employed by
the new business facility and must have been employed at the new business
facility for at least one full calendar month. The director may
temporarily reduce or waive this requirement for any business in an
enterprise zone with ten or less full-time employees, and for businesses
with eleven to twenty full-time employees this requirement may be
temporarily reduced. No reduction or waiver may be granted for more than
one tax period and shall not be renewable. The exemptions allowed in
sections 135.215 and 135.220 and the credits allowed in sections 135.225
and 135.235 and the refund established and authorized in section 135.245
shall not be allowed to any "public utility", as such term is defined in
section 386.020, RSMo. For the purposes of achieving the fifteen-percent
employment requirement set forth in this subsection, a new business
facility described as NAICS 336991 may count employees who were residents
of the enterprise zone at the time they were employed by the new business
facility and for at least ninety days thereafter, regardless of whether
such employees continue to reside in the enterprise zone, so long as the
employees remain employed by the new business facility and residents of
the state of Missouri.

2. Notwithstanding the provisions of subsection 1 of this section, motor
carriers, barge lines or railroads engaged in transporting property for
hire or any interexchange telecommunications company that establish a new
business facility shall be eligible to qualify for the exemptions allowed
in sections 135.215 and 135.220, and the credits allowed in sections
135.225 and 135.235 and the refund established and authorized in section
135.245, except that trucks, truck-trailers, truck semitrailers, rail or
barge vehicles or other rolling stock for hire, track, switches, bridges,
barges, tunnels, rail yards and spurs shall not constitute new business
facility investment nor shall truck drivers or rail or barge vehicle
operators constitute new business facility employees.

3. Notwithstanding any other provision of sections 135.200 to 135.256 to
the contrary, motor carriers establishing a new business facility on or
after January 1, 1993, but before January 1, 1995, may qualify for the
tax credits available pursuant to sections 135.225 and 135.235 and the
exemption provided in section 135.220, even if such new business facility
has not satisfied the employee criteria, provided that such taxpayer
employs an average of at least two hundred persons at such facility,
exclusive of truck drivers and provided that such taxpayer maintains an
average investment of at least ten million dollars at such facility,
exclusive of rolling stock, during the tax period for which such credits
and exemption are being claimed.

4. Any governing authority having jurisdiction of an area that has been
designated an enterprise zone may petition the department to expand the
boundaries of such existing enterprise zone. The director may approve
such expansion if the director finds that:

(1) The area to be expanded meets the requirements prescribed in section
135.207 or 135.210, whichever is applicable;

(2) The area to be expanded is contiguous to the existing enterprise
zone; and

(3) The number of expansions do not exceed three after August 28, 1994.

5. Notwithstanding the fifteen-year limitation as prescribed in
subsection 1 of this section, any governing authority having jurisdiction
of an area that has been designated as an enterprise zone by the
director, except one designated pursuant to this subsection, may file a
petition, as prescribed by the director, for redesignation of such area
for an additional period not to exceed seven years following the
fifteenth anniversary of the enterprise zone's initial designation date;
provided:

(1) The petition is filed with the director within three years prior to
the date the tax credits authorized in sections 135.225 and 135.235 and
the exemption allowed in section 135.220 are required to be removed
pursuant to subsection 1 of this section;

(2) The governing authority identifies and conforms the boundaries of the
area to be designated a new enterprise zone to the political boundaries
established by the latest decennial census, unless otherwise approved by
the director;

(3) The area satisfies the requirements prescribed in subdivisions (3),
(4) and (5) of section 135.205 according to the latest decennial census
or other appropriate source as approved by the director;

(4) The governing authority satisfies the requirements prescribed in
sections 135.210, 135.215 and 135.255;

(5) The director finds that the area is unlikely to support reasonable
tax assessment or to experience reasonable economic growth without such
designation; and

(6) The director's recommendation that the area be designated as an
enterprise zone is approved by the joint committee on economic
development policy and planning, as otherwise required in subsection 3 of
section 135.210.

6. Any taxpayer having established a new business facility in an
enterprise zone except one designated pursuant to subsection 5 of this
section, who did not earn the tax credits authorized in sections 135.225
and 135.235 and the exemption allowed in section 135.220 for the full
ten-year period because of the fifteen-year limitation as prescribed in
subsection 1 of this section, shall be granted such benefits for ten tax
years, less the number of tax years the benefits were claimed or could
have been claimed prior to the expiration of the original fifteen-year
period, except that such tax benefits shall not be earned for more than
seven tax periods during the ensuing seven-year period, provided the
taxpayer continues to operate the new business facility in an area that
is designated an enterprise zone pursuant to subsection 5 of this
section. Any taxpayer who establishes a new business facility subsequent
to the commencement of the ensuing seven-year period, as authorized in
subsection 5 of this section, may qualify for the tax credits authorized
in sections 135.225 and 135.235, and the exemptions authorized in
sections 135.215 and 135.220, pursuant to the same terms and conditions
as prescribed in sections 135.100 to 135.256. The designation of any
enterprise zone pursuant to subsection 5 of this section shall not be
subject to the fifty enterprise zone limitation imposed in subsection 4
of section 135.210. (L. 1982 H.B. 1713, et al. § 8, A.L. 1983 H.B. 559,
A.L. 1986 S.B. 727, A.L. 1991 H.B. 294 & 405, A.L. 1992 S.B. 661 & 620,
A.L. 1994 H.B. 1248 & 1048 § 135.230 subsecs. 1, 3, 4, 5, merged with
S.B. 740, A.L. 1995 H.B. 414, A.L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess.
S.B. 1, A.L. 1999 H.B. 701, A.L. 2001 H.B. 453 merged with H.B. 738)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

To the extent that expenses incurred by a new business facility
in an enterprise zone for the training of persons employed in the
operation of the new business facility is not covered by an existing
federal, state or local program, such new business facility shall be
eligible for a full tax credit equal to eighty percent of that portion of
such training expenses which are in excess of four hundred dollars for
each trainee who is a resident of the enterprise zone or who was at the
time of such employment at the new business facility unemployable or
difficult to employ as defined in section 135.240, provided such credit
shall not exceed four hundred dollars for each employee trained. In the
case of a small corporation described in section 143.471, RSMo, or a
partnership, all credits allowed by this section shall be apportioned in
proportion to the share of ownership of the business to the following:

(1) The shareholders of the corporation described in section 143.471,
RSMo; or

(2) The partners in a partnership. (L. 1982 H.B. 1713, et al. § 9, A.L.
1986 S.B. 727, A.L. 1991 H.B. 294 & 405)

The provisions of subdivision (3) of section 135.225 and section
135.230 shall apply to employees determined to:

(1) Be difficult to employ. For the purpose of this section, "a person
difficult to employ" shall mean a person who was unemployed for at least
three months immediately prior to being employed at the new business
facility in the enterprise zone; or

(2) Be eligible for aid to families with dependent children or general
relief programs. (L. 1982 H.B. 1713, et al. § 10, A.L. 1986 S.B. 727,
A.L. 1991 H.B. 294 & 405, A.L. 1992 S.B. 661 & 620)

1. Notwithstanding any other provision of Missouri law, some
portion of the tax credits earned by a newly established new business
facility within an enterprise zone through the provisions of sections
135.200 to 135.256, except one designated pursuant to subsection 5 of
section 135.230, which exceeds its total income tax liability shall be
considered an overpayment of the income tax and shall be refunded to the
taxpayer as provided by this section, except that such refund shall only
apply to taxpayers subject to the tax imposed pursuant to chapter 143,
RSMo. The refund allowed by this section shall be limited to taxpayers
who establish new facilities in enterprise zones. The refund shall not be
allowed to a taxpayer who establishes a new business facility because it
qualifies as a separate facility pursuant to subsection 6 of section
135.110 or subdivision (7) of subsection 1 of section 135.225 or because
it satisfies the requirements of paragraph (c) of subdivision (4) of
section 135.100 or subdivision (10) of section 135.100. The provisions of
this section shall have effect on all initial applications filed on or
after August 28, 1992. The provisions of this section shall only be
available to a taxpayer for the first two consecutive years during which
the taxpayer is eligible for the credits provided by sections 135.200 to
135.256, and the portion of tax credit which is considered an overpayment
of the income tax shall be limited to fifty percent or fifty thousand
dollars, whichever is less, in the first year and twenty-five percent or
twenty-five thousand dollars, whichever is less, in the second year in
which the taxpayer is eligible. The overpayment of the income tax for the
first year shall not be refunded to the taxpayer until the third taxable
year of operation by the new business facility and the overpayment of the
income tax for the second year shall not be refunded to the taxpayer
until the fourth taxable year of operation by the new business facility.

2. The portion of tax credit which is considered an overpayment of the
income tax by any taxpayer who establishes a new business facility in an
enterprise zone designated pursuant to subsection 5 of section 135.230
shall be limited to twenty-five percent or twenty-five thousand dollars,
whichever is less, in the first year of the ensuing seven-year period.
Such overpayment of tax shall not be refunded to the taxpayer until the
third taxable year of operation by the new business facility.

3. Such refunds to the taxpayer shall be made as otherwise provided by
law. In the case of a small corporation described in section 143.471,
RSMo, or a partnership, all refunds allowed by this section shall be
apportioned in proportion to the share of ownership of the business on
the last day of the taxpayer's tax period for which such tax credits are
being claimed, to the following:

(1) The shareholders of the corporation described in section 143.471,
RSMo; or

(2) The partners in a partnership. (L. 1982 H.B. 1713, et al. § 11, A.L.
1983 H.B. 559, A.L. 1986 S.B. 727, A.L. 1991 H.B. 294 & 405, A.L. 1992
S.B. 661 & 620, A.L. 1995 H.B. 414, A.L. 1996 H.B. 1237)

Effective 1-1-97

1. Notwithstanding the provisions of sections 135.205, 135.207,
and 135.210 or any other provisions to the contrary, any area having been
designated by the United States Department of Housing and Urban
Development as a federal empowerment zone or by the United States
Department of Agriculture as an enterprise community pursuant to the
federal Omnibus Budget Reconciliation Act of 1993, title XIII, chapter I,
subchapter c, shall immediately upon such federal designation become and
remain a state enterprise zone until the expiration of such federal
designation.

2. The credits otherwise provided by sections 135.225 and 135.235, the
exemption provided by section 135.220, and the refund provided by section
135.245 shall be available to any taxpayer who establishes and operates a
new business facility located within a federal empowerment zone or
enterprise community on the same terms and conditions specified in
sections 135.100 to 135.256. The exemption provided in section 135.215
shall be available to any taxpayer who makes improvements to real
property after the date the area is designated as a federal empowerment
zone or enterprise community pursuant to the same terms and conditions
specified in section 135.215.

3. Notwithstanding any provision of law to the contrary, retail
businesses, as defined by SICs 52 through 59, hotels and motels, as
defined by SIC 7011, and recreational facilities as defined by SIC 7999,
shall be eligible for all benefits provided pursuant to the provisions of
sections 135.200 to 135.256, if:

(1) In the case of a retail business, such business is located within a
state-designated enterprise zone located wholly or partially within a
federal empowerment zone or enterprise community; or

(2) Such business is located within a satellite enterprise zone,
established pursuant to subdivision (1) or (3) of subsection 1 of section
135.207, whether or not such satellite zone is contained within a federal
empowerment zone or enterprise community; and

(3) In the case of a hotel or motel, such business is located within an
enterprise zone which is located within any county of the first
classification with a population of at least five hundred thousand but
less than seven hundred thousand inhabitants according to the last
decennial census, or in an enterprise zone which is located within any
city of the third classification which is partially located within a
county of the first class with a population of one hundred fifty thousand
or more which is adjacent to a county of the first classification with a
population of at least five hundred thousand but less than seven hundred
thousand according to the last decennial census; and

(4) In the case of a recreational facility, such business is located
within an area designated a satellite enterprise zone pursuant to
subdivision (1) of subsection 1 of section 135.207, by the director after
January 1, 1991, and before January 1, 1992, in any city not within a
county, and further provided the director approves the eligibility of
such recreational facility to claim tax benefits otherwise allowed in
sections 135.200 to 135.256. When making such determination, the director
shall consider the number and quality of new jobs to be created, the
amount of payroll and investment to be generated from the proposed
project, the extent to which such tax concessions are needed to induce
the development, whether the area is unlikely to support reasonable tax
assessment or to experience reasonable economic growth without such
designation and the overall economic benefits to be realized from the
proposed project.

4. For purposes of qualifying for benefits pursuant to this section,
recreational facilities, as defined by SIC 7999, shall not include:

(1) An excursion gambling boat licensed pursuant to sections 313.800 to
313.850, RSMo, and the docking facility associated with such licensed
excursion gambling boat; or

(2) An excursion gambling boat and docking facility as proposed on an
application filed with the Missouri gaming commission. (L. 1994 H.B. 1248
& 1048, A.L. 1995 H.B. 414, A.L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess.
S.B. 1)

Effective 12-23-97

1. The director of the department of economic development may,
subject to the requirements of section 536.021, RSMo, issue such rules
and regulations as he deems necessary regarding the qualifications
necessary for an area to be deemed an "enterprise zone" and for the
continuation of such designation. Beginning January 1, 1987, the director
shall prescribe the method for submitting applications for claiming the
tax credits allowed in sections 135.225 and 135.235 and the exemption
allowed in section 135.220 and shall, if such application is approved,
certify same to the director of revenue that the taxpayer claiming the
credits allowed in sections 135.225 and 135.235 and the exemption allowed
in section 135.220 has satisfied all requirements prescribed in sections
135.200 to 135.255, and is therefore eligible to claim the credits and
exemption. The director shall also calculate and specify the amount of
the credits earned by the taxpayer during the taxpayer's first taxable
year in which such credits are claimed and for each of the nine
succeeding taxable years the credits are claimed by the taxpayer and
shall certify such amounts to the director of revenue. The director shall
certify the extent to which such earned credits and the exemption allowed
in section 135.220 can be claimed to the director of revenue and shall
notify the taxpayer in writing of such determination. The director may
prescribe such rules and regulations necessary to carry out the
provisions of sections 135.200 to 135.255.

2. The director of revenue shall determine the amount of the taxpayer's
refund, as allowed in section 135.245, if any, and shall notify the
taxpayer in writing of any amount to be refunded. The director of revenue
may, subject to the requirements of section 536.021, RSMo, prescribe
rules and regulations necessary to process the credits allowed in
sections 135.225 and 135.235 and the exemption allowed in section 135.220
and the refund allowed in section 135.245 following certification of
eligibility by the director. No rule or portion of a rule promulgated
under the authority of this section shall become effective unless it has
been promulgated pursuant to the provisions of section 536.024, RSMo.

3. Any taxpayer who has submitted an application for claiming tax credits
as allowed in sections 135.225, 135.235, or the exemption allowed in
section 135.220 or an application to be certified as a new business
facility for the purpose of claiming the refund as allowed in section
135.245, may file with the director of economic development, a protest
within sixty days (one hundred fifty days if the taxpayer is outside the
United States) after the date of such certification notice or the date of
the notice denying such certification. The protest shall be in writing
and shall set forth the grounds on which the protest is based.

4. If a protest is filed, the director of economic development shall
consider the taxpayer's grounds for protest and make a determination
concerning such protest. The director of economic development shall
notify the taxpayer in writing of such determination within thirty days
following the date in which the written protest was received. Such notice
shall be mailed to the taxpayer by certified or registered mail and such
notice shall set forth briefly the director of economic development's
findings of fact and the basis of decision.

5. The decision of the director of economic development on the taxpayer's
protest is final upon the expiration of thirty days from the date when he
mails notice of his action to the taxpayer unless within this period, the
taxpayer seeks review of the director of economic development's
determination by the administrative hearing commission. (L. 1982 H.B.
1713, et al. § 12, A.L. 1985 H.B. 416, A.L. 1986 S.B. 727, A.L. 1989 H.B.
181 & 633, A.L. 1991 H.B. 294 & 405, A.L. 1995 S.B. 3)

After August 13, 1982, whenever an enterprise zone resident
becomes displaced as a result of condemnation authorized under the
provisions of chapter 353, RSMo, and is displaced from a dwelling which
was actually owned and occupied by the displaced person as his principal
residence for not less than one year prior to the initiation of
negotiations for acquisition of the property, the redevelopment
corporation shall make payment to the displaced person upon proper
application for:

(1) Actual expenses up to five hundred dollars incurred in moving
himself, his family and other personal property; or the displaced person
may elect to be moved by licensed, bonded moving services, or receive* a
moving expense allowance up to a maximum of five hundred dollars;

(2) Actual dislocation expenses incurred up to two hundred dollars,
including as eligible expenses, but not limited to, utility connection
costs, and other incidental expenses;

(3) The amount, if any, which, when added to the acquisition cost of the
dwelling acquired by the redevelopment corporation, equals the reasonable
cost of a replacement dwelling which is comparable to the dwelling being
acquired in size, condition, and accessibility to public services, and
commercial facilities, and which is reasonably accessible to his place of
employment, and is available on the private market without discrimination
due to race, color, creed, religion, national origin, sex or source of
income;

(4) The amount, if any, which will compensate the displaced person for
any increased interest costs which such person is required to pay for
financing the acquisition of a replacement dwelling. Such amount shall be
equal to the interest differential between the existing and new mortgage
based upon the remaining principal and term on the existing mortgage;

(5) The amount, if any, which will compensate the displaced person for
any increased monthly payments for principal, interest, taxes and
insurance which such person is required to pay due to the loss by such
person of government subsidies, including, but not limited to, subsidies
under Section 235 of Title 24, Code of Federal Regulations, as a result
of being displaced. Such amount shall be discounted to present value. The
discount rate shall be five and one-half percent. The payments authorized
by this section shall be made only to a displaced person who purchases or
occupies a replacement dwelling which is decent, safe and sanitary not
later than one year after the date on which the displaced person receives
payment of consideration for the acquired dwelling or the date on which
the displaced person moves from the acquired dwelling, whichever is
later. No payment under this section to any displaced person may exceed
ten thousand dollars. (L. 1982 H.B. 1713, et al. § 13)

*Word "received" appears in original rolls.

In addition to the number of enterprise zones authorized under
the provisions of sections 135.206 and 135.210, the department of
economic development shall designate one such zone in every city of the
third class in every county of the third class which contains a state
university whose primary mission is engineering studies and technical
research. Such enterprise zone designation shall only be made if the area
in the city which is to be included meets all the requirements of section
135.205. (L. 1989 H.B. 249 & 47 § 1 merged with S.B. 59 § 1)

In addition to the number of enterprise zones authorized
pursuant to the provisions of sections 135.206, 135.208, 135.210 and
135.256, the department of economic development shall designate one such
zone in any city not within a county if such area which is to be included
in the enterprise zone meets all the requirements of section 135.205. (L.
1997 2d Ex. Sess. S.B. 1 § 1)

Effective 12-23-97

1. A taxpayer shall not be entitled to receive the tax credits,
the exemption and the refunds respectively provided for in sections
135.110, 135.220, 135.225, and 135.245 solely because the taxpayer has
met and maintained the new investment and new job creation criteria
required by sections 135.100 through 135.256. In addition to meeting
these criteria, the taxpayer must be in receipt of an approved letter of
intent as described in subsection 2 of this section. The taxpayer shall
make available such copies of the approved letter of intent, as may be
required, to the department of revenue.

2. In order to be eligible for the tax credits, exemption and refunds
specified in subsection 1 of this section, a taxpayer must submit a
letter of intent to the director of the department of economic
development. The letter of intent shall be completed on a form that shall
be prepared by the department. It need not contain an estimate of the
amounts of the tax credits, exemption or refunds for which the taxpayer
may become eligible. The letter of intent shall be submitted to the
director at least fifteen days prior to the commencement of commercial
operations as defined in subdivision (1) of section 135.100. The director
shall approve or deny the letter of intent and return such to the
taxpayer within fifteen days of its receipt. (L. 1998 H.B. 1656)

Effective 1-1-99

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

In addition to the number of enterprise zones authorized under
the provisions of sections 135.206 to 135.260, the department of economic
development shall designate any area that meets all the requirements of
section 135.205 as an enterprise zone. (L. 2004 S.B. 1155)

1. Any automobile manufacturer or assembler, as defined by
standard industrial classification code (SIC) number 3711, that is
located within a state enterprise zone established pursuant to sections
135.200 to 135.256 may make an application to the department of economic
development for a strategic initiative investment income tax refund.

2. Such refunds shall be approved only if the total amount of tax credits
certified for the automobile manufacturer or assembler in the four
calendar years immediately preceding 1998 exceeded the company's total
Missouri tax on taxable income in those years by an amount equal to at
least twenty million dollars. In such cases, a portion of tax credits
earned shall constitute an overpayment of taxes and may be refunded to
the taxpayer in the manner authorized by this section as a strategic
initiative income tax fund.

3. The department shall evaluate and may approve such applications based
upon the importance of the manufacturer to the economy of Missouri, the
company's investment of at least one hundred million dollars in new
facilities or equipment, and the number of jobs to be created or retained
as a result of new investment. Such applications may be approved annually
for no longer than five successive years. The maximum amount of refund
that may be awarded to the manufacturer or assembler shall not exceed two
million dollars per year. (L. 1998 S.B. 827 § 1)

As used in sections 135.276 to 135.283, the following terms mean:

(1) "Continuation of commercial operations" shall be deemed to occur
during the first taxable year following the taxable year during which the
business entered into an agreement with the department pursuant to
section 135.283 in order to receive the tax exemption, tax credits and
refundable credits authorized by sections 135.276 to 135.283;

(2) "Department", the department of economic development;

(3) "Director", the director of the department of economic development;

(4) "Enterprise zone", an enterprise zone created under section 135.210
that includes all or part of a home rule city with more than twenty-six
thousand but less than twenty-seven thousand inhabitants located in any
county with a charter form of government and with more than one million
inhabitants;

(5) "Facility", any building used as a revenue-producing enterprise
located within an enterprise zone, including the land on which the
facility is located and all machinery, equipment, and other real and
depreciable tangible personal property acquired for use at and located at
or within such facility and used in connection with the operation of such
facility;

(6) "NAICS", the industrial classification as such classifications are
defined in the 1997 edition of the North American Industrial
Classification System Manual as prepared by the Executive Office of the
President, Office of Management and Budget;

(7) "Retained business facility", a facility in an enterprise zone
operated by the taxpayer which satisfies the following requirements as
determined by the department and included in an agreement with the
department:

(a) The taxpayer agrees to a capital investment project at the facility
of at least five hundred million dollars to take place over a period of
two consecutive taxable years ending no later than the fifth taxable year
after continuation of commercial operations;

(b) The taxpayer has maintained at least two thousand employees per year
at the facility for each of the five taxable years preceding the year of
continuation of commercial operations;

(c) The taxpayer agrees to maintain at least the level of employment that
it had at the facility in the taxable year immediately preceding the year
of continuation of commercial operations for ten consecutive taxable
years beginning with the year of the continuation of commercial
operations. Temporary layoffs necessary to implement the capital
investment project will not be considered a violation of this requirement;

(d) The taxpayer agrees that the amount of the average wage paid by the
taxpayer at the facility will exceed the average wage paid within the
county in which the facility is located for ten consecutive taxable years
beginning with the year of the continuation of commercial operations;

(e) Significant local incentives with respect to the project or retained
facility have been committed, which incentives may consist of:

a. Cash or in-kind incentives derived from any nonstate source, including
incentives provided by the affected political subdivisions, private
industry and/or local chambers of commerce or similar such organizations;
or

b. Relief from local taxes;

(f) Receipt of the tax exemption, tax credits, and refunds are major
factors in the taxpayer's decision to retain its operations at the
facility in Missouri and go forward with the capital investment project
and not receiving the exemption, credits, and refunds will result in the
taxpayer moving its operations out of Missouri; and

(g) There is at least one other state that the taxpayer verifies is being
considered as the site to which the facility's operations will be
relocated;

(8) "Retained business facility employee", a person employed by the
taxpayer in the operation of a retained business facility during the
taxable year for which the credit allowed by section 135.279 is claimed,
except that truck drivers and rail and barge vehicle operators shall not
constitute retained business facility employees. A person shall be deemed
to be so employed if such person performs duties in connection with the
operation of the retained business facility on a regular, full-time
basis. The number of retained business facility employees during any
taxable year shall be determined by dividing by twelve the sum of the
number of individuals employed on the last business day of each month of
such taxable year. If the retained business facility is in operation for
less than the entire taxable year, the number of retained business
facility employees shall be determined by dividing the sum of the number
of individuals employed on the last business day of each full calendar
month during the portion of such taxable year during which the retained
business facility was in operation by the number of full calendar months
during such period;

(9) "Retained business facility income", the Missouri taxable income, as
defined in chapter 143, RSMo, derived by the taxpayer from the operation
of the retained business facility. If a taxpayer has income derived from
the operation of a retained business facility as well as from other
activities conducted within this state, the Missouri taxable income
derived by the taxpayer from the operation of the retained business
facility shall be determined by multiplying the taxpayer's Missouri
taxable income, computed in accordance with chapter 143, RSMo, by a
fraction, the numerator of which is the property factor, as defined in
paragraph (a) of this subdivision, plus the payroll factor, as defined in
paragraph (b) of this subdivision, and the denominator of which is two:

(a) The "property factor" is a fraction, the numerator of which is the
retained business facility investment certified for the tax period, and
the denominator of which is the average value of all the taxpayer's real
and depreciable tangible personal property owned or rented and used in
this state during the tax period. The average value of all such property
shall be determined as provided in chapter 32, RSMo;

(b) The "payroll factor" is a fraction, the numerator of which is the
total amount paid during the tax period by the taxpayer for compensation
to persons qualifying as retained business facility employees at the
retained business facility, and the denominator of which is the total
amount paid in this state during the tax period by the taxpayer for
compensation. The compensation paid in this state shall be determined as
provided in chapter 32, RSMo;

(10) "Retained business facility investment", the value of real and
depreciable tangible personal property, acquired by the taxpayer as part
of the retained business facility after the date of continuation of
commercial operations, which is used by the taxpayer in the operation of
the retained business facility, during the taxable year for which the
credit allowed by section 135.279 is claimed, except that trucks,
truck-trailers, truck semitrailers, rail vehicles, barge vehicles,
aircraft and other rolling stock for hire, track, switches, barges,
bridges, tunnels, rail yards, and spurs shall not constitute retained
business facility investments. The total value of such property during
such taxable year shall be:

(a) Its original cost if owned by the taxpayer; or

(b) Eight times the net annual rental rate, if leased by the taxpayer.
The net annual rental rate shall be the annual rental rate paid by the
taxpayer less any annual rental rate received by the taxpayer from
subrentals. The retained business facility investment shall be determined
by dividing by twelve the sum of the total value of such property on the
last business day of each calendar month of the taxable year. If the
retained business facility is in operation for less than an entire
taxable year, the retained business facility investment shall be
determined by dividing the sum of the total value of such property on the
last business day of each full calendar month during the portion of such
taxable year during which the retained business facility was in operation
by the number of full calendar months during such period;

(11) "Revenue-producing enterprise", manufacturing activities classified
as NAICS 336211. (L. 2003 H.B. 289 merged with S.B. 620)

Effective 6-18-03 (S.B. 620)

7-07-03 (H.B. 289)

Contingent expiration date, see § 135.284

The provisions of chapter 143, RSMo, notwithstanding, one- half
of the Missouri taxable income attributed to an approved retained
business facility that is earned by a taxpayer operating the approved
retained business facility may be exempt from taxation under chapter 143,
RSMo. That portion of income attributed to the retained business facility
shall be determined in a manner prescribed in paragraph (b) of
subdivision (9) of section 135.276, except that compensation paid to
truck drivers, rail, or barge vehicle operators shall be excluded from
the fraction. (L. 2003 H.B. 289 merged with S.B. 620)

Effective 6-18-03 (S.B. 620)

7-07-03 (H.B. 289)

Contingent expiration date, see § 135.284

1. Any taxpayer that operates an approved retained business
facility in an enterprise zone may be allowed a credit, each year for ten
years, in an amount determined pursuant to subsection 2 or 3 of this
section, whichever is applicable, against the tax imposed by chapter 143,
RSMo, excluding withholding tax imposed by sections 143.191 to 143.265,
RSMo, as follows:

(1) The credit allowed for each retained business facility employee shall
be four hundred dollars, except that for each retained business facility
employee that exceeds the level of employment set forth in paragraph (b)
of subdivision (7) of section 135.276, the credit shall be five hundred
dollars. Transfers from another facility operated by the taxpayer in the
state will not count as retained business facility employees;

(2) An additional credit of four hundred dollars shall be granted for
each twelve-month period that a retained business facility employee is a
resident of an enterprise zone;

(3) An additional credit of four hundred dollars shall be granted for
each twelve-month period that the person employed as a retained business
facility employee is a person who, at the time of such employment by the
new business facility, met the criteria as set forth in section 135.240;

(4) To the extent that expenses incurred by a retained business facility
in an enterprise zone for the training of persons employed in the
operation of the retained business facility is not covered by an existing
federal, state, or local program, such retained business facility shall
be eligible for a full tax credit equal to eighty percent of that portion
of such training expenses which are in excess of four hundred dollars for
each trainee who is a resident of an enterprise zone or who was at the
time of such employment at the retained business facility unemployable or
difficult to employ as defined in section 135.240, provided such credit
shall not exceed four hundred dollars for each employee trained;

(5) The credit allowed for retained business facility investment shall be
equal to the sum of ten percent of the first ten thousand dollars of such
qualifying investment, plus five percent of the next ninety thousand
dollars of such qualifying investment, plus two percent of all remaining
qualifying investments within an enterprise zone. The taxpayer's retained
business facility investment shall be reduced by the amount of investment
made by the taxpayer or related taxpayer which was subsequently
transferred to the retained business facility from another Missouri
facility and for which credits authorized in this section are not being
earned.

2. The credits allowed by subsection 1 of this section shall offset the
greater of:

(1) Some portion of the income tax otherwise imposed by chapter 143,
RSMo, excluding withholding tax imposed by sections 143.191 to 143.265,
RSMo, with respect to such taxpayer's retained business facility income
for the taxable year for which such credit is allowed; or

(2) If the taxpayer operates no other facility in Missouri, the credits
allowed in subsection 1 of this section shall offset up to fifty percent
or, in the case of an economic development project located within a
distressed community as defined in section 135.530, seventy-five percent
of the business income tax otherwise imposed by chapter 143, RSMo,
excluding withholding tax imposed by sections 143.191 to 143.265, RSMo,
if the business operates no other facilities in Missouri;

(3) If the taxpayer operates more than one facility in Missouri, the
credits allowed in subsection 1 of this section shall offset up to the
greater of the portion prescribed in subdivision (1) of this subsection
or twenty-five percent or, in the case of an economic development project
located within a distressed community as defined in section 135.530,
thirty-five percent of the business' tax, except that no taxpayer
operating more than one facility in Missouri shall be allowed to offset
more than twenty-five percent or, in the case of an economic development
project located within a distressed community as defined in section
135.530, thirty-five percent of the taxpayer's business income tax in any
tax period under the method prescribed in this subdivision.

3. In the case where a person employed by the retained business facility
is a resident of the enterprise zone for less than a twelve-month period,
or in the case where a person employed as a retained business facility
employee is a person who, at the time of such employment by the retained
business facility, met the criteria as set forth in section 135.240, is
employed for less than a twelve-month period, the credits allowed by
subdivisions (2) and (3) of subsection 1 of this section shall be
determined by multiplying the dollar amount of the credit by a fraction,
the numerator of which is the number of calendar days during the
taxpayer's tax year for which such credits are claimed, in which the
person met the requirements prescribed in subdivision (2) or (3) of this
subsection, and the denominator of which is three hundred sixty-five.

4. Notwithstanding any provision of law to the contrary, any taxpayer who
claims the exemption and credits allowed in sections 135.276 to 135.283
shall not be eligible to receive the exemption allowed in section
135.220, the credits allowed in sections 135.225 and 135.235, and the
refund authorized by section 135.245 or the tax credits allowed in
section 135.110. The taxpayer must elect among the options. To perfect
the election, the taxpayer shall attach written notification of such
election to the taxpayer's initial application for claiming tax credits.
The election shall be irreversible once perfected.

5. A taxpayer shall not receive the income exemption described in section
135.276 and the tax credits described in subsection 1 of this section for
any year in which the terms and conditions of sections 135.276 to 135.283
are not met. Such incentives shall not exceed the fifteen-year limitation
pursuant to subsection 1 of section 135.230 or the seven-year limitation
pursuant to subsection 5 of section 135.230.

6. The initial application for claiming tax credits must be made in the
taxpayer's tax period immediately following the tax period in which
commencement of commercial operations began at the new business facility.

7. Credits may not be carried forward but shall be claimed for the
taxable year during which continuation of commercial operations occurs at
such retained business facility, and for each of the nine succeeding
taxable years. (L. 2003 H.B. 289 merged with S.B. 620)

Effective 6-18-03 (S.B. 620)

7-07-03 (H.B. 289)

Contingent expiration date, see § 135.284

1. Any taxpayer operating an approved retained business facility
that is located within a state enterprise zone established pursuant to
sections 135.200 to 135.256 may make an application to the department of
economic development for an income tax refund.

2. Such refunds shall be approved only if the amount of tax credits
certified for the taxpayer in the taxable year exceeded the company's
total Missouri tax on taxable income in that year by an amount equal to
at least one million dollars. In such cases, a portion of tax credits
earned shall constitute an overpayment of taxes and may be refunded to
the taxpayer in the manner authorized by this section.

3. The department shall evaluate and may approve such applications based
upon the importance of the approved retained business facility to the
economy of Missouri, the company's investment of at least five hundred
million dollars in facilities or equipment, and the number of jobs to be
created or retained. Such applications may be approved annually for no
longer than five successive years. The maximum amount of refund that may
be awarded to the manufacturer or assembler shall not exceed two million
dollars per year. Notwithstanding other provisions of law to the
contrary, if the taxpayer's tax credits issued under sections 135.276 to
135.283 for a taxable year exceed the taxpayer's taxable income by more
than two million dollars, the credits may be carried forward for five
years or until used, whichever is earlier, and may be included in refund
amounts otherwise authorized by this section. (L. 2003 H.B. 289 merged
with S.B. 620)

Effective 6-18-03 (S.B. 620)

7-07-03 (H.B. 289)

Contingent expiration date, see § 135.284

1. A taxpayer shall apply to the department for approval to
participate in the program authorized by sections 135.276 to 135.283. The
application shall be in a form prescribed by and contain all information
requested by the department to determine eligibility for the program and
for the department to make its decision whether to approve the taxpayer
for participation in the program.

2. The department may issue an approval contingent upon the successful
execution of an agreement between the department and the taxpayer seeking
approval of a facility as a retained business facility which shall
include, but not be limited to, the following:

(1) A detailed description of the project that is the subject of the
agreement;

(2) A requirement that the taxpayer shall annually report to the
department the total amount of salaries and wages paid to eligible
employees in retained business facility jobs, and any other information
the department requires to confirm compliance with the requirements of
sections 135.276 to 135.283;

(3) A requirement that the taxpayer shall provide written notification to
the director not more than thirty days after the taxpayer makes or
receives a proposal that would transfer the taxpayer's state tax
liability obligations to a successor taxpayer;

(4) A requirement that the taxpayer shall maintain operations at the
facility location for at least ten years at a certain employment level;

(5) The requirements otherwise required by sections 135.276 to 135.283;
and

(6) A provision for repayment of incentives upon breach of the agreement.
(L. 2003 H.B. 289 merged with S.B. 620)

Effective 6-18-03 (S.B. 620)

7-07-03 (H.B. 289)

Contingent expiration date, see § 135.284

1. The repeal and reenactment of sections 100.710, 100.840, and
178.892, and the enactment of sections 135.276, 135.277, 135.279,
135.281, and 135.283 shall expire on January 1, 2006, if no essential
industry retention projects have been approved by the department of
economic development by December 31, 2005. If an essential industry
retention project has been approved by the department of economic
development by December 31, 2005, the repeal and reenactment of sections
100.710, 100.840, and 178.892, and the enactment of sections 135.276,
135.277, 135.279, 135.281, and 135.283 shall expire on January 1, 2020.

2. Notwithstanding any other provision of law to the contrary, the time
for approval of essential industry retention projects as identified in
subsection 1 of this section is extended until December 31, 2007, and if
an essential industry retention project has been approved by the
department of economic development by December 31, 2007, the provisions
of subsection 1 of this section shall expire on January 1, 2020. (L. 2003
H.B. 289 § B merged with S.B. 620 § B, A.L. 2005 S.B. 343 §§ 135.284, 1)

*Contingent expiration date for subsection 1.

1. Notwithstanding any provision of law to the contrary, no
revenue-producing enterprise shall receive the state tax exemption, state
tax credits, or state tax refund as provided in sections 135.200 to
135.283 for facilities commencing operations on or after January 1, 2005.
This provision is not intended to affect in any way the local real
property tax abatement authorized by section 135.215.

2. Notwithstanding subsection 4 of section 135.215 to the contrary, if an
exemption pursuant to section 135.215 is granted on property prior to the
expiration of the twenty-five year anniversary of the designation of the
enterprise zone, the property may continue to receive that exemption for
up to twenty-five years following the date the exemption on that property
was granted, provided that the total number of years of exemption on that
property shall not exceed twenty-five. (L. 2004 S.B. 1155)

As used in sections 135.300 to 135.311, unless the context
requires otherwise, the following terms mean:

(1) "Missouri forestry industry residue", any residue that results from
normal timber harvest or production to include slash, sawdust, shavings,
edgings, slabs, leaves, bark, and timber thinnings from timber stand
improvements;

(2) "Processed wood products", wood pellets, cubes, flour, or any product
that results from thermal, chemical, or mechanical processes that
sufficiently alter the wood residue to be used as an energy source.
Hogged wood and chipped wood do not qualify as processed wood energy
resources under sections 135.300 to 135.311;

(3) "Wood energy producer", any person, firm or corporation who engages
in the business of producing processed wood products, to be used as an
energy source, from Missouri forest industry residues;

(4) "Wood energy producing facility", a Missouri facility using Missouri
forest industry residue to produce processed wood products. (L. 1985 H.B.
831 § 1, A.L. 1996 H.B. 1237)

Effective 1-1-97

A Missouri wood energy producer shall be eligible for a tax
credit on taxes otherwise due under chapter 143, RSMo, except sections
143.191 to 143.261, RSMo, as a production incentive to produce processed
wood products in a qualified wood producing facility using Missouri
forest product residue. The tax credit to the wood energy producer shall
be five dollars per ton of processed material. The credit may be claimed
for a period of five years and is to be a tax credit against the tax
otherwise due. (L. 1985 H.B. 831 § 2, A.L. 1996 H.B. 1237)

Effective 1-1-97

Any amount of credit which exceeds the tax due shall not be
refunded but may be carried over to any subsequent taxable year, not to
exceed four years. (L. 1985 H.B. 831 § 3, A.L. 1996 H.B. 1237)

Effective 1-1-97

The wood energy producer may elect to assign to a third party
the approved tax credit. Certification of assignment and other
appropriate forms must be filed with the Missouri department of revenue.
(L. 1985 H.B. 831 § 4, A.L. 1996 H.B. 1237)

Effective 1-1-97

When applying for a tax credit the wood energy producer shall
make application for the credit to the division of energy of the
department of natural resources. The application shall include:

(1) The number of tons of processed wood products produced during the
preceding calendar year;

(2) The name and address of the person to whom processed products were
sold and the number of tons sold to each person;

(3) Other information which the department of natural resources
reasonably requires. The application shall be received and reviewed by
the division of energy of the department of natural resources and the
division shall certify to the department of revenue each applicant which
qualifies as a wood energy-producing facility. (L. 1985 H.B. 831 §§ 5, 6,
A.L. 1991 S.B. 185, A.L. 1996 H.B. 1237)

Effective 1-1-97

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

1. Any person, firm or corporation who engages in the business
of producing charcoal or charcoal products in the state of Missouri shall
be eligible for a tax credit on income taxes otherwise due pursuant to
chapter 143, RSMo, except sections 143.191 to 143.261, RSMo, as an
incentive to implement safe and efficient environmental controls. The tax
credit shall be equal to fifty percent of the purchase price of the best
available control technology equipment connected with the production of
charcoal in the state of Missouri or, if the taxpayer manufactures such
equipment, fifty percent of the manufacturing cost of the equipment, to
and including the year the equipment is put into service. The credit may
be claimed for a period of eight years beginning with the 1998 calendar
year and is to be a tax credit against the tax otherwise due.

2. Any amount of credit which exceeds the tax due shall not be refunded
but may be carried over to any subsequent taxable year, not to exceed
seven years.

3. The charcoal producer may elect to assign to a third party the
approved tax credit. Certification of assignment and other appropriate
forms must be filed with the Missouri department of revenue and the
department of economic development.

4. When applying for a tax credit, the charcoal producer specified in
subsection 1 of this section shall make application for the credit to the
division of environmental quality of the department of natural resources.
The application shall identify the specific best available control
technology equipment and the purchase price, or manufacturing cost of
such equipment. The director of the department of natural resources is
authorized to require permits to construct prior to the installation of
best available control technology equipment and other information which
he or she deems appropriate.

5. The director of the department of natural resources in conjunction
with the department of economic development shall certify to the
department of revenue that the best available control technology
equipment meets the requirements to obtain a tax credit as specified in
this section. (L. 1998 H.B. 1656)

Effective 1-1-99

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

Sections 135.325 to 135.339 shall be known and may be cited as
the "Special Needs Adoption Tax Credit Act". (L. 1987 S.B. 402 § 1)

Effective 1-1-88

As used in sections 135.325 to 135.339, the following terms
shall mean:

(1) "Business entity", person, firm, a partner in a firm, corporation or
a shareholder in an S corporation doing business in the state of Missouri
and subject to the state income tax imposed by the provisions of chapter
143, RSMo, or a corporation subject to the annual corporation franchise
tax imposed by the provisions of chapter 147, RSMo, or an insurance
company paying an annual tax on its gross premium receipts in this state,
or other financial institution paying taxes to the state of Missouri or
any political subdivision of this state under the provisions of chapter
148, RSMo, or an express company which pays an annual tax on its gross
receipts in this state pursuant to chapter 153, RSMo;

(2) "Handicap", a mental, physical, or emotional impairment that
substantially limits one or more major life activities, whether the
impairment is congenital or acquired by accident, injury or disease, and
where the impairment is verified by medical findings;

(3) "Nonrecurring adoption expenses", reasonable and necessary adoption
fees, court costs, attorney fees, and other expenses which are directly
related to the legal adoption of a special needs child and which are not
incurred in violation of federal, state, or local law;

(4) "Special needs child", a child for whom it has been determined by the
division of family services, or by a child-placing agency licensed by the
state, or by a court of competent jurisdiction to be a child:

(a) That cannot or should not be returned to the home of his or her
parents; and

(b) Who has a specific factor or condition such as ethnic background,
age, membership in a minority or sibling group, medical condition, or
handicap because of which it is reasonable to conclude that such child
cannot be easily placed with adoptive parents;

(5) "State tax liability", any liability incurred by a taxpayer under the
provisions of chapter 143, RSMo, chapter 147, RSMo, chapter 148, RSMo,
and chapter 153, RSMo, exclusive of the provisions relating to the
withholding of tax as provided for in sections 143.191 to 143.265, RSMo,
and related provisions. (L. 1987 S.B. 402 § 2, A.L. 1995 H.B. 414, A.L.
1999 H.B. 316, et al.)

1. Any person residing in this state who legally adopts a
special needs child on or after January 1, 1988, and before January 1,
2000, shall be eligible to receive a tax credit of up to ten thousand
dollars for nonrecurring adoption expenses for each child adopted that
may be applied to taxes due under chapter 143, RSMo. Any business entity
providing funds to an employee to enable that employee to legally adopt a
special needs child shall be eligible to receive a tax credit of up to
ten thousand dollars for nonrecurring adoption expenses for each child
adopted that may be applied to taxes due under such business entity's
state tax liability, except that only one ten thousand dollar credit is
available for each special needs child that is adopted.

2. Any person residing in this state who proceeds in good faith with the
adoption of a special needs child on or after January 1, 2000, shall be
eligible to receive a tax credit of up to ten thousand dollars for
nonrecurring adoption expenses for each child that may be applied to
taxes due under chapter 143, RSMo; provided, however, that beginning on
or after July 1, 2004, a minimum of fifty percent of the tax credits
allowed shall be allocated for the adoption of special needs children who
are residents or wards of residents of this state at the time the
adoption is initiated. Any business entity providing funds to an employee
to enable that employee to proceed in good faith with the adoption of a
special needs child shall be eligible to receive a tax credit of up to
ten thousand dollars for nonrecurring adoption expenses for each child
that may be applied to taxes due under such business entity's state tax
liability, except that only one ten thousand dollar credit is available
for each special needs child that is adopted.

3. Individuals and business entities may claim a tax credit for their
total nonrecurring adoption expenses in each year that the expenses are
incurred. A claim for fifty percent of the credit shall be allowed when
the child is placed in the home. A claim for the remaining fifty percent
shall be allowed when the adoption is final. The total of these tax
credits shall not exceed the maximum limit of ten thousand dollars per
child. The cumulative amount of tax credits which may be claimed by
taxpayers claiming the credit for nonrecurring adoption expenses in any
one fiscal year prior to July 1, 2004, shall not exceed two million
dollars and shall not exceed four million dollars in any one fiscal year
beginning on or after July 1, 2004; provided, however, that in the first
ninety days following each July first, if less than two million dollars
in credits have been issued for adoption of special needs children who
are not residents or wards of residents of this state at the time the
adoption is initiated, the remaining amount of the four million dollar
cap shall be available for the adoption of special needs children who are
residents or wards of residents of this state at the time the adoption is
initiated.

4. Notwithstanding any provision of law to the contrary, any individual
or business entity may assign, transfer or sell tax credits allowed in
this section. Any sale of tax credits claimed pursuant to this section
shall be at a discount rate of seventy-five percent or greater of the
amount sold.

5. The director of revenue shall establish a procedure by which, for each
fiscal year, the cumulative amount of tax credits authorized in this
section is equally apportioned among all taxpayers within the two
categories specified in subsection 2 of this section claiming the credit
in that fiscal year. To the maximum extent possible, the director of
revenue shall establish the procedure described in this subsection in
such a manner as to ensure that taxpayers within each category can claim
all the tax credits possible up to the cumulative amount of tax credits
available for the fiscal year.

6. The director of revenue shall submit to the general assembly, by
January 1, 2005, and each succeeding year, information by income levels
of those individual taxpayers who have qualified and claimed the credit
authorized in this section, regardless of whether those taxpayers have
assigned, transferred, or sold such credits. The information shall
indicate the number of such taxpayers with federal adjusted gross income
in the immediately preceding tax year of less than one hundred fifty
thousand dollars, of one hundred fifty thousand dollars to and including
one hundred ninety thousand dollars, and of more than one hundred ninety
thousand dollars. (L. 1987 S.B. 402 § 3, A.L. 1995 H.B. 414, A.L. 1999
H.B. 316, et al., A.L. 2002 S.B. 923, et al., A.L. 2004 H.B. 1453)

Effective 7-1-04

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

No credit shall be allowable for that portion of the
nonrecurring adoption expenses for which a credit is allowable and taken
under any similar provision of federal, state, or local law. Credit may
be taken up to the amount allowable under section 135.327 for that
portion of the nonrecurring adoption expenses which exceed the credit
taken under such other provision of federal, state or local law. If there
is a deduction allowable and taken under any other provision of federal,
state or local law which is similar to the credit allowable under section
135.327, the credit allowable for nonrecurring adoption expenses shall be
reduced by the amount of the decrease in the tax liability resulting from
taking such deduction. No credit shall be allowable for that portion of
the nonrecurring adoption expenses paid from any funds received under any
federal, state, or local program. (L. 1987 S.B. 402 § 4, A.L. 1995 H.B.
414)

Effective 1-1-96

No credit shall be allowable for the adoption of any child who
has attained the age of eighteen, unless it has been determined that the
child has a medical condition or handicap that would limit the child's
ability to live independently of the adoptive parents. (L. 1987 S.B. 402
§ 5)

Effective 1-1-88

1. Any amount of tax credit which exceeds the tax due shall not
be refunded but may be carried over to any subsequent taxable year, not
to exceed a total of five years for which a tax credit may be taken for
each child adopted.

2. Tax credits that are assigned, transferred or sold as allowed in
section 135.327 may be assigned, transferred or sold in their entirety
notwithstanding the taxpayer's tax due. (L. 1987 S.B. 402 § 6, A.L. 1999
H.B. 316, et al.)

In the year of adoption and in any year thereafter in which the
credit is carried forward pursuant to section 135.333, the credit shall
be reduced by an amount equal to the state's cost of providing care,
treatment, maintenance and services when:

(1) The special needs child is placed, with no intent to return to the
adoptive home, in foster care or residential treatment licensed or
operated by the division of family services, the division of youth
services or the department of mental health; or

(2) A juvenile court temporarily or finally relieves the adoptive parents
of custody of the special needs child. (L. 1987 S.B. 402 § 7)

Effective 1-1-88

A tax credit taken by a person or business entity under the
provisions of sections 135.325 to 135.339 shall not be considered in
determining the eligibility for, or the amount of, any adoption subsidy
to the child adopted, including a subsidy for nonrecurring adoption
expenses, that is available under any federal, state, or local program.
(L. 1987 S.B. 402 § 8, A.L. 1995 H.B. 414)

Effective 1-1-96

The director of revenue, in consultation with the division of
family services, shall prescribe such rules and regulations necessary to
carry out the provisions of sections 135.325 to 135.339. No rule or
portion of a rule promulgated under the authority of sections 135.325 to
135.339 shall become effective unless it has been promulgated pursuant to
the provisions of section 536.024, RSMo. (L. 1987 S.B. 402 § 9, A.L. 1993
S.B. 52, A.L. 1995 S.B. 3)

1. As used in this section, the following terms mean:

(1) "Approved program", a sponsorship and mentoring program established
pursuant to this section and approved by the department of elementary and
secondary education;

(2) "Eligible student", a resident pupil of a school district who is
determined by the local school board to be eligible to participate in a
sponsorship and mentoring program pursuant to this section and who
participates in such program for no less than eight calendar months in
the tax year for which a return is filed claiming a credit authorized in
this section;

(3) "Net expenditures", only those amounts paid or incurred for the
participation of an eligible student participating in an approved
sponsorship and mentoring program less any amounts received by the
qualified taxpayer from any source for the provision of a sponsorship and
mentoring program for an eligible student;

(4) "Qualified taxpayer", an employer who makes expenditures pursuant to
this section.

2. For taxable years commencing on or after January 1, 1998, a qualified
taxpayer shall be allowed a credit against the tax imposed by chapter
143, RSMo, exclusive of the provisions relating to the withholding of tax
as provided in sections 143.191 to 143.265, RSMo, to the extent of the
lesser of two thousand dollars times the number of eligible students for
which the qualified taxpayer is allowed a credit pursuant to this section
or the net expenditures made directly or through a fund during a taxable
year by the qualified taxpayer for the participation of an eligible
student in an approved sponsorship and mentoring program established
pursuant to this section. No credit shall be allowed for any amounts for
which any other credit is claimed or allowed under any other provision of
state law for the same net expenditures.

3. The tax credit allowed by this section shall be claimed by the
qualified taxpayer at the time such taxpayer files a return and shall be
applied against the income tax liability imposed by chapter 143, RSMo,
after all other credits provided by law have been applied. Where the
amount of the credit exceeds the tax liability, the difference between
the credit and the tax liability shall not be refundable but may be
carried forward to any of the taxpayer's four subsequent taxable years.

4. The department of elementary and secondary education shall establish,
by rule, guidelines and criteria for approval of sponsorship and
mentoring programs established by school districts and for determining
the eligibility of students for participation in sponsorship and
mentoring programs established pursuant to this section. Such
determinations for eligibility of students shall be based upon a
definition of an at-risk student as established by the department by rule.

5. A local school board may establish a sponsorship and mentoring program
and apply to the department of elementary and secondary education for
approval of such program. A tax credit may only be received pursuant to
this section for expenditures for sponsorship and mentoring programs
approved by the department. The school board of each district which has
an approved program shall annually certify to the department of
elementary and secondary education the number of eligible students
participating in the program. The principal of any school in a district
which has an approved program may recommend, to the local school board,
those students who do not meet the definition of "at-risk" students
established pursuant to this section, and the school board may submit the
names of such students and the circumstances which justify the student's
participation in an approved program to the department of elementary and
secondary education for approval of such student's participation. If
approved by the department, such students shall be considered eligible
students for participation in an approved program.

6. The department of elementary and secondary education shall provide
written notification to the department of revenue of each eligible
student participating in an approved program pursuant to this section,
the student's school district, the name of the qualified taxpayer
approved to receive a tax credit on the basis of such eligible student's
participation in an approved program pursuant to this section and the
amount of such credit as determined in subsection 2 of this section. This
section is subject to appropriations. (L. 1998 S.B. 781)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

As used in this section, unless the context clearly requires
otherwise, the following words and phrases shall mean:

(1) "Commission", the Missouri housing development commission, or its
successor agency;

(2) "Director", director of the department of revenue;

(3) "Eligibility statement", a statement authorized and issued by the
commission certifying that a given project qualifies for the Missouri
low-income housing tax credit. The commission shall promulgate rules
establishing criteria upon which the eligibility statements will be
issued. The eligibility statement shall specify the amount of the
Missouri low-income housing tax credit allowed. The commission shall only
authorize the tax credits to qualified projects which begin after June
18, 1991;

(4) "Federal low-income housing tax credit", the federal tax credit as
provided in section 42 of the 1986 Internal Revenue Code, as amended;

(5) "Low-income project", a housing project which has restricted rents
that do not exceed thirty percent of median income for at least forty
percent of its units occupied by persons of families having incomes of
sixty percent or less of the median income, or at least twenty percent of
the units occupied by persons or families having incomes of fifty percent
or less of the median income;

(6) "Median income", those incomes which are determined by the federal
Department of Housing and Urban Development guidelines and adjusted for
family size;

(7) "Qualified Missouri project", a qualified low-income building as that
term is defined in section 42 of the 1986 Internal Revenue Code, as
amended, which is located in Missouri;

(8) "Taxpayer", person, firm or corporation subject to the state income
tax imposed by the provisions of chapter 143, RSMo, (except withholding
imposed by sections 143.191 to 143.265, RSMo) or a corporation subject to
the annual corporation franchise tax imposed by the provisions of chapter
147, RSMo, or an insurance company paying an annual tax on its gross
premium receipts in this state, or other financial institution paying
taxes to the state of Missouri or any political subdivision of this state
under the provisions of chapter 148, RSMo, or an express company which
pays an annual tax on its gross receipts in this state. (L. 1990 H.B. 960
§ 3 subsec. 1, A.L. 1991 S.B. 185)

Effective 6-18-91

1. A taxpayer owning an interest in a qualified Missouri project
shall be allowed a state tax credit, whether or not allowed a federal tax
credit, to be termed the Missouri low-income housing tax credit, if the
commission issues an eligibility statement for that project.

2. For qualified Missouri projects placed in service after January 1,
1997, the Missouri low-income housing tax credit available to a project
shall be such amount as the commission shall determine is necessary to
ensure the feasibility of the project, up to an amount equal to the
federal low-income housing tax credit for a qualified Missouri project,
for a federal tax period, and such amount shall be subtracted from the
amount of state tax otherwise due for the same tax period.

3. The Missouri low-income housing tax credit shall be taken against the
taxes and in the order specified pursuant to section 32.115, RSMo. The
credit authorized by this section shall not be refundable. Any amount of
credit that exceeds the tax due for a taxpayer's taxable year may be
carried back to any of the taxpayer's three prior taxable years or
carried forward to any of the taxpayer's five subsequent taxable years.

4. All or any portion of Missouri tax credits issued in accordance with
the provisions of sections 135.350 to 135.362 may be allocated to parties
who are eligible pursuant to the provisions of subsection 1 of this
section. Beginning January 1, 1995, for qualified projects which began on
or after January 1, 1994, an owner of a qualified Missouri project shall
certify to the director the amount of credit allocated to each taxpayer.
The owner of the project shall provide to the director appropriate
information so that the low-income housing tax credit can be properly
allocated.

5. In the event that recapture of Missouri low-income housing tax credits
is required pursuant to subsection 2 of section 135.355, any statement
submitted to the director as provided in this section shall include the
proportion of the state credit required to be recaptured, the identity of
each taxpayer subject to the recapture and the amount of credit
previously allocated to such taxpayer.

6. The director of the department may promulgate rules and regulations
necessary to administer the provisions of this section. No rule or
portion of a rule promulgated pursuant to the authority of this section
shall become effective unless it has been promulgated pursuant to the
provisions of section 536.024, RSMo. (L. 1990 H.B. 960 § 3 subsec. 2
subdivs. (1), (2), A.L. 1991 S.B. 185, A.L. 1993 H.B. 566, A.L. 1994 H.B.
1745, A.L. 1995 S.B. 3, A.L. 1997 H.B. 578)

*Rulemaking authority, effective when, null and void, when, see RSMo
135.361.

1. The owner of a qualified Missouri project eligible for the
Missouri low-income housing tax credit shall submit, at the time of
filing the owner's return, an eligibility statement. In the case of
failure to attach the eligibility statement, no credit under this section
shall be allowed with respect to such project for that year until these
copies are provided to the department of revenue.

2. If under Section 42 of the 1986 Internal Revenue Code, as amended, a
portion of any federal low-income housing credits taken on a low-income
project is required to be recaptured only during the first ten years
after a project is placed in service, the taxpayer claiming state credits
with respect to such project shall also be required to recapture a
portion of any state credits authorized by this section. The state
recapture amount shall be equal to the proportion of the state credit
claimed by the taxpayer that equals the proportion the federal recapture
amount bears to the original federal low-income housing credit amount
subject to recapture. (L. 1990 H.B. 960 § 3 subsec. 2 subdivs. (3), (4),
A.L. 1994 H.B. 1745, A.L. 2000 H.B. 1238)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

A taxpayer shall be allowed to exclude from taxation under
chapter 143, RSMo, a portion of the capital gain, as calculated under the
Internal Revenue Code of 1986, as amended, that results from the sale of
a low-income project subsidized by the federal Department of Housing and
Urban Development to a nonprofit or governmental organization, agreeing
to preserve or increase the low-income occupancy of the project. For
those owners whose low-income project has at least forty percent of its
units occupied by persons or families having incomes of sixty percent or
less of the median income, the exclusion shall equal twenty-five percent
of the capital gain. (L. 1990 H.B. 960 § 3 subsec. 3)

Effective 10-1-90

The director or the commission may require the filing of
additional documentation necessary to determine the accuracy of a tax
preference claimed under the provisions of this section through the
promulgation of rules. No rule or portion of a rule promulgated under the
authority of sections 135.350 to 135.363 shall become effective unless it
has been promulgated pursuant to the provisions of section 536.024, RSMo.
(L. 1990 H.B. 960 § 3 subsec. 4, A.L. 1991 S.B. 185, A.L. 1993 S.B. 52,
A.L. 1994 H.B. 1248 & 1048, A.L. 1995 S.B. 3)

Any rule or portion of a rule promulgated pursuant to this bill*
shall become effective only as provided pursuant to chapter 536, RSMo,
including but not limited to section 536.028, RSMo, if applicable, after
August 28, 1997. All rulemaking authority delegated prior to August 28,
1997, is of no force and effect and repealed. The provisions of this
section are nonseverable and if any of the powers vested with the general
assembly pursuant to section 536.028, RSMo, if applicable, to review, to
delay the effective date, or to disapprove and annul a rule or portion of
a rule are held unconstitutional or invalid, the purported grant of
rulemaking authority and any rule so proposed and contained in the order
of rulemaking shall be invalid and void. (L. 1997 H.B. 578 § 2)

*"This bill" (H.B. 578, 1997) contained numerous sections. Consult
Disposition of Sections table for a definitive listing.

1. The provisions of subdivision (3) of section 135.350 shall
not apply to any qualified Missouri project:

(1) With respect to which a loan is made or insured under Title V of the
U.S. Housing Act of 1949; or

(2) In which at least ten percent of the total reasonably expected basis
in such project was incurred by the project owner prior to June 18, 1991,
and such project is placed in service no later than December 31, 1993.

2. Qualified Missouri projects described in subdivisions (1) and (2) of
subsection 1 of this section shall continue to be governed by the
provisions of subdivision (2) of section 135.350 in effect prior to June
18, 1991. (L. 1991 S.B. 185 § A § 1, A.L. 1993 H.B. 566)

1. All or any portion of tax credits issued in accordance with
the provisions of sections 135.350 to 135.363 may be transferred, sold or
assigned to parties who are eligible under the provisions of subsection 1
of section 135.352.

2. Beginning January 1, 1995, for qualified projects which began on or
after January 1, 1994, an owner or transferee desiring to make a
transfer, sale or assignment as described in subsection 1 of this section
shall submit to the director of the department of revenue a statement
which describes the amount of credit for which such transfer, sale or
assignment of credit is eligible. The owner shall provide to the director
of revenue appropriate information so that the low-income housing tax
credit can be properly allocated.

3. In the event that recapture of Missouri low-income housing tax credits
is required pursuant to subsection 2 of section 135.355, any statement
submitted to the director of the department of revenue as provided in
this section shall include the proportion of the state credit required to
be recaptured, the identity of each transferee subject to recapture and
the amount of credit previously transferred to such transferee.

4. The director of the department of revenue may prescribe rules and
regulations necessary for the administration of the provisions of this
section. (L. 1994 H.B. 1248 & 1048)

As used in sections 135.400 to 135.430, the following terms mean:

(1) "Certificate", a tax credit certificate issued by the department of
economic development in accordance with sections 135.400 to 135.430;

(2) "Community bank", either a bank community development corporation or
development bank, which are financial organizations which receive
investments from commercial financial institutions regulated by the
federal reserve, the office of the comptroller of the currency, the
office of thrift supervision, or the Missouri division of finance.
Community banks, in addition to their other privileges, shall be allowed
to make loans to businesses or equity investments in businesses or in
real estate provided that such transactions have associated public
benefits;

(3) "Community development corporation", a not-for-profit corporation
whose board of directors is composed of businesses, civic and community
leaders, and whose primary purpose is to encourage and promote the
industrial, economic, entrepreneurial, commercial, and civic development
or redevelopment of a community or area, including the provision of
housing and community development projects that benefit low-income
individuals and communities;

(4) "Department", the Missouri department of economic development;

(5) "Director", the director of the department of economic development,
or a person acting under the supervision of the director;

(6) "Investment", a transaction in which a Missouri small business or a
community bank receives a monetary benefit from an investor pursuant to
the provisions of sections 135.403 to 135.414;

(7) "Investor", an individual, partnership, financial institution, trust
or corporation meeting the eligibility requirements of sections 135.403
to 135.414. In the case of partnerships and nontaxable trusts, the
individual partners or beneficiaries shall be treated as the investors;

(8) "Missouri small business", an independently owned and operated
business as defined in Title 15 U.S.C. Section 632(a) and as described by
Title 13 CFR Part 121, which is headquartered in Missouri and which
employs at least eighty percent of its employees in Missouri, except that
no such small business shall employ more than one hundred employees. Such
businesses must be involved in interstate or intrastate commerce for the
purpose of manufacturing, processing or assembling products, conducting
research and development, or providing services in interstate commerce,
but excluding retail, real estate, insurance or professional services.
For the purpose of qualifying for the tax credit pursuant to sections
135.400 to 135.430, "Missouri small business" shall include cooperative
marketing associations organized pursuant to chapter 274, RSMo, which are
engaged in the business of producing and marketing fuels derived from
agriculture commodities, without regard for whether a cooperative
marketing association has more than one hundred employees. Cooperative
marketing associations organized pursuant to chapter 274, RSMo, shall not
be required to comply with the requirements of section 135.414;

(9) "Primary employment", work which pays at least the minimum wage and
which is not seasonal or part-time;

(10) "Principal owners", one or more persons who own an aggregate of
fifty percent or more of the Missouri small business and who are involved
in the operation of the business as a full-time professional activity;

(11) "Project", any commercial or industrial business or other economic
development activity undertaken in a target area, designed to reduce
conditions of blight, unemployment or widespread reliance on public
assistance which creates permanent primary employment opportunities;

(12) "State tax liability", any liability incurred by a taxpayer pursuant
to the provisions of chapter 143, RSMo, chapter 147, RSMo, chapter 148,
RSMo, section 375.916, RSMo, and chapter 153, RSMo, exclusive of the
provisions relating to the withholding of tax as provided for in sections
143.191 to 143.265, RSMo, and related provisions;

(13) "Target area", a group of blocks or a self-defined neighborhood
where the rate of poverty in the area is greater than twice the national
poverty rate and as defined by the department of social services in
conjunction with the department of economic development. Areas of the
state satisfying the criteria of this subdivision may be designated as a
"target area" following appropriate findings made and certified by the
departments of economic development and social services. In making such
findings, the departments of economic development and social services may
use any commonly recognized records and statistical indices published or
made available by any agency or instrumentality of the federal or state
government. No area of the state shall be a target area until so
certified by the department of social services and the revitalization
plan submitted pursuant to section 208.335, RSMo, has received approval.
(L. 1992 S.B. 661 & 620 § 8, A.L. 1994 H.B. 1547 & 961, A.L. 1995 H.B.
414, S.B. 445, A.L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess. S.B. 1, A.L.
1998 S.B. 827, A.L. 2003 H.B. 289)

CROSS REFERENCE: Annual report for tax credits, RSMo 320.092

There is hereby created in the state treasury a revolving fund
to be administered by the department of economic development to be known
as the "Community Development Fund". The fund shall consist of all moneys
which may be appropriated to it by the general assembly, gifts,
contributions, grants or bequests received from federal, private or other
sources. Moneys in the fund shall be used for the programs and activities
implemented by community development corporations to stimulate economic
development in neighborhoods or communities. Notwithstanding the
provisions of section 33.080, RSMo, money in the fund at the end of any
biennium shall not be transferred to the general revenue fund. (L. 1996
H.B. 1237)

Effective 1-1-97

1. Any investor who makes a qualified investment in a Missouri
small business shall be entitled to receive a tax credit equal to forty
percent of the amount of the investment or, in the case of a qualified
investment in a Missouri small business in a distressed community as
defined by section 135.530, a credit equal to sixty percent of the amount
of the investment, and any investor who makes a qualified investment in a
community bank or a community development corporation shall be entitled
to receive a tax credit equal to fifty percent of the amount of the
investment if the investment is made in a community bank or community
development corporation for direct investment. The total amount of tax
credits available for qualified investments in Missouri small businesses
shall not exceed thirteen million dollars and at least four million
dollars of the amount authorized by this section and certified by the
department of economic development shall be for investment in Missouri
small businesses in distressed communities. Authorization for all or any
part of this four- million-dollar amount shall in no way restrict the
eligibility of Missouri small businesses in distressed communities, as
defined in section 135.530, for the remaining amounts authorized within
this section. No more than twenty percent of the tax credits available
each year for investments in community banks or community development
corporations for direct investment shall be certified for any one
project, as defined in section 135.400. The tax credit shall be evidenced
by a tax credit certificate in accordance with the provisions of sections
135.400 to 135.430 and may be used to satisfy the state tax liability of
the owner of the certificate that becomes due in the tax year in which
the qualified investment is made, or in any of the ten tax years
thereafter. When the qualified small business is in a distressed
community, as defined in section 135.530, the tax credit may also be used
to satisfy the state tax liability of the owner of the certificate that
was due during each of the previous three years in addition to the year
in which the investment is made and any of the ten years thereafter. No
investor may receive a tax credit pursuant to sections 135.400 to 135.430
unless that person presents a tax credit certificate to the department of
revenue for payment of such state tax liability. The department of
revenue shall grant tax credits in the same order as established by
subsection 1 of section 32.115, RSMo. Subject to the provisions of
sections 135.400 to 135.430, certificates of tax credit issued in
accordance with these sections may be transferred, sold or assigned by
notarized endorsement thereof which names the transferee.

2. Five hundred thousand dollars in tax credits shall be available
annually from the total amount of tax credits authorized by section
32.110, RSMo, and subdivision (4) of subsection 2 of section 32.115,
RSMo, as a result of investments in community banks or community
development corporations. Aggregate investments eligible for tax credits
in any one Missouri small business shall not be more than one million
dollars. Aggregate investments eligible for tax credits in any one
Missouri small business shall not be less than five thousand dollars as
of the date of issuance of the first tax credit certificate for
investment in that business.

3. This section and section 620.1039, RSMo, shall become effective
January 1, 2001. (L. 1992 S.B. 661 & 620 § 9 subsecs. 1, 2, A.L. 1994
H.B. 1547 & 961, A.L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess. S.B. 1, A.L.
1998 H.B. 1656, A.L. 2000 S.B. 894 §§ 135.403, B)

Effective 1-1-01

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

The total amount of tax credit evidenced by certificates of tax
credit issued to or owned, directly or indirectly, by a single taxpayer
authorized by the department who has invested in a Missouri small
business shall be not less than one thousand five hundred dollars nor
more than an aggregate of one hundred thousand dollars in any one
business, except that this section shall not be interpreted to limit
other investment. These limits shall not apply to investments in
community banks or community development corporations or to investments
in Missouri small businesses in distressed communities, as defined in
section 135.530. (L. 1992 S.B. 661 & 620 § 9 subsec. 3, A.L. 1994 H.B.
1547 & 961, A.L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess. S.B. 1, A.L. 1998
H.B. 1656)

Effective 1-1-99

A qualified investment in a Missouri small business may be made
either through an unsecured loan or the purchase of equity or unsecured
debt securities of such business. Investors in a small business
qualifying for tax credits under the provisions of sections 135.400 to
135.430, however, must collectively own less than fifty percent of a
business after their investments are made. Qualified investments in a
Missouri small business must be expended for capital improvements, plant,
equipment, research and development, or working capital for the business
or such business activity as may be approved by the department. (L. 1992
S.B. 661 & 620 § 9 subsec. 4, A.L. 1994 H.B. 1547 & 961)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

The amount of the qualified investment made in a Missouri small
business must remain in that business for a minimum of five years.
Withdrawal of the investment prior to the minimum five-year period shall
result in revocation of the tax credit, and repayment of any amounts of
the tax credit already applied against the investor's state tax
liability. (L. 1992 S.B. 661 & 620 § 9 subsec. 5, A.L. 1994 H.B. 1248 &
1048)

The business receiving the investment must have annual revenues
of two million dollars or less determined as of the end of the most
recent fiscal year and the operation of the business must be the
full-time professional activity of the principal owner or owners, except
full-time researchers or faculty members at public or private
universities. The following persons or entities shall not be eligible for
a credit against state tax liability under the provisions of sections
135.400 to 135.430:

(1) The principal owner;

(2) The spouse of the principal owner;

(3) Any person related to the person specified in subdivision (1) or (2)
of this section within the third degree of consanguinity or affinity; or

(4) Any corporation, partnership, trust or other entity which is
controlled, directly or indirectly, by any of the persons specified in
subdivision (1), (2) or (3) of this section where fifty percent or more
of the equity interest in any such entity is owned, directly or
indirectly, by any of the persons specified in subdivision (1), (2) or
(3) of this section. (L. 1992 S.B. 661 & 620 § 9 subsec. 6, A.L. 1994
H.B. 1547 & 961, A.L. 1995 H.B. 414)

Effective 1-1-96

All investments in Missouri small businesses for which tax
credits are claimed under the provisions of sections 135.400 to 135.430
shall satisfy the conditions of being registered or specifically exempt
from registration by provisions or regulations under chapter 409, RSMo,
that require a certain percentage of the investment to be used in
Missouri. (L. 1992 S.B. 661 & 620 § 10, A.L. 1994 H.B. 1547 & 961)

The director shall be responsible for the administration and
issuance of the certificates of tax credits authorized by sections
135.400 to 135.429. The director shall issue a certificate of tax credit
at the request of any qualified investor. Each request shall include a
true copy of the documents as defined by the administrative rules of the
department. Each request shall be acknowledged under oath by the investor
making the request for tax credits. (L. 1992 S.B. 661 & 620 § 11)

Effective 1-1-93

The department may revoke a tax credit certificate if any
representation to the department in connection with the application
proves to have been false when made or if the application violates any
conditions established by the department and stated in the tax credit
certificate. The revocation may be in full or in part as the department
may determine. The department shall specify the amount of credit being
revoked and shall send notice of the revocation to the investor and to
the state department of revenue. (L. 1992 S.B. 661 & 620 § 12)

Effective 1-1-93

The Missouri department of revenue or secretary of state,
whichever is applicable, shall accept a certificate of tax credit in lieu
of other payment in such amount as is equal to the lesser of the amount
of the tax or the remaining unused amount of the credit as indicated on
the certificate of tax credit; and shall indicate on the certificate of
tax credit the amount of tax thereby paid, the date of such payment, and
the remainder of the unused credit available to the taxpayer after such
payment. The certificate of the credit shall be returned to the director
of the department of economic development. The director of the department
of economic development shall issue a new certificate to the property
owner for any unused balance. (L. 1992 S.B. 661 & 620 § 13)

Effective 1-1-93

Except as otherwise specifically provided in sections 135.400 to
135.430, interest and penalty provisions and procedural matters under the
provisions of sections 135.400 to 135.430 shall be determined pursuant to
and in the manner prescribed in chapter 143, RSMo, chapter 147, RSMo,
chapter 148, RSMo, or chapter 153, RSMo, whichever is applicable. (L.
1992 S.B. 661 & 620 §§ 14, E, A.L. 1994 H.B. 1547 & 961)

The department of social services shall promulgate such rules
and regulations, pursuant to chapter 536, RSMo, and section 660.017,
RSMo, as are necessary to define and certify target areas as defined in
section 135.400. The department of economic development shall promulgate
such rules and regulations, pursuant to chapter 536, RSMo, and subsection
20 of section 620.010, RSMo, as are necessary to implement the provisions
of sections 135.400 to 135.440 after a target area has been defined and
certified by the department of social services. (L. 1994 H.B. 1547 & 961,
Repealed L. 1995 H.B. 414 § A, A.L. 1995 S.B. 445)

*Revisor's note: During the 1st Regular Session of the 88th General
Assembly, 1995, this section was both repealed by H.B. 414 and amended
and reenacted by S.B. 445. Apparently this section is still in effect.

1. The department of economic development shall identify active
community development corporations operating within the state and assist
them in the formation of a Missouri community development corporation
association. The department shall assist the community development
corporation association in an amount up to ten percent of its total
appropriation for community development corporations to cover the cost
associated with the activities of the association. The association shall
serve as a clearinghouse for information for community development
corporations. The association shall help staff members of community
development corporations develop administrative skills in such areas as
entrepreneurial development, grant writing, real estate analysis,
financial deals structuring, negotiations, human resource development,
strategic planning and community needs assessment. The association shall
sponsor conferences which allow community development corporations to
learn about community development activities statewide and at the federal
level.

2. The Missouri community development corporation association shall be
funded by dues assessed against participating community development
corporations. The association shall adopt, alter or repeal its own
bylaws, rules and regulations governing the manner in which its business
may be transacted; elect officers; make expenditures which are incidental
and necessary to carry out its purposes and powers; and do all things
necessary to ensure full participation by Missouri community development
corporations in any federal program relating to community development
needs. (L. 1997 2d Ex. Sess. S.B. 1 § 3, A.L. 2003 H.B. 289)

1. The department of economic development shall promulgate such
rules and regulations as are necessary to implement the provisions of
sections 135.400 to 135.430.

2. No rule or portion of a rule promulgated under the authority of this
chapter shall become effective until it has been approved by the joint
committee on administrative rules in accordance with the procedures
provided in this section, and the delegation of the legislative authority
to enact law by the adoption of such rules is dependent upon the power of
the joint committee on administrative rules to review and suspend rules
pending ratification by the senate and the house of representatives as
provided in this section.

3. Upon filing any proposed rule with the secretary of state, the
department shall concurrently submit such proposed rule to the committee,
which may hold hearings upon any proposed rule or portion thereof at any
time.

4. A final order of rulemaking shall not be filed with the secretary of
state until thirty days after such final order of rulemaking has been
received by the committee. The committee may hold one or more hearings
upon such final order of rulemaking during the thirty-day period. If the
committee does not disapprove such order of rulemaking within the thirty-
day period, the department may file such order of rulemaking with the
secretary of state and the order of rulemaking shall be deemed approved.

5. The committee may, by majority vote of the members, suspend the order
of rulemaking or portion thereof by action taken prior to the filing of
the final order of rulemaking only for one or more of the following
grounds:

(1) An absence of statutory authority for the proposed rule;

(2) An emergency relating to public health, safety or welfare;

(3) The proposed rule is in conflict with state law;

(4) A substantial change in circumstance since enactment of the law upon
which the proposed rule is based.

6. If the committee disapproves any rule or portion thereof, the
department shall not file such disapproved portion of any rule with the
secretary of state and the secretary of state shall not publish in the
Missouri Register any final order of rulemaking containing the
disapproved portion.

7. If the committee disapproves any rule or portion thereof, the
committee shall report its findings to the senate and the house of
representatives. No rule or portion thereof disapproved by the committee
shall take effect so long as the senate and the house of representatives
ratify the act of the joint committee by resolution adopted in each house
within thirty legislative days after such rule or portion thereof has
been disapproved by the joint committee.

8. Upon adoption of a rule as provided in this section, any such rule or
portion thereof may be suspended or revoked by the general assembly
either by bill or, pursuant to section 8, article IV of the Constitution
of Missouri, by concurrent resolution upon recommendation of the joint
committee on administrative rules. The committee shall be authorized to
hold hearings and make recommendations pursuant to the provisions of
section 536.037, RSMo. The secretary of state shall publish in the
Missouri Register, as soon as practicable, notice of the suspension or
revocation. (L. 1995 H.B. 414)

Effective 7-5-95

1. The department of economic development shall establish a
public-private partnership to be known as the "Missouri Community
Development Corporation Initiative". The initiative shall be supported by
appropriations made to the department for that purpose and from federal
funds and private corporations. All moneys for the operation of the
initiative shall be deposited into the community development fund as
established by section 135.401.

2. The initiative shall support the organizational development of
community development corporations. Its purpose is to help these
corporations initiate and develop strategies which generate beneficial
self-sustaining economic and human development activities in minority and
underdeveloped communities. It shall use public and private dollars to
identify community development corporations appropriate for assistance,
to administer a grants process, to offer bridge financing, and to lend
technical assistance in numerous areas including the construction of
affordable housing and the development of commercial real estate. Funding
from the initiative to community development corporations may be in the
following forms:

(1) Operational grants;

(2) Special opportunity grants;

(3) Gap financing for single and multifamily housing, office space,
industrial space, plants and equipment, child care facilities, and small
business incubators or entrepreneurial development;

(4) Bridge loans for emergency needs;

(5) Initial programs for emerging community development corporations to
complete their first projects;

(6) Certificate of deposit loan leveraging programs to leverage loans
made to community development corporations by financial institutions for
land acquisition and construction; and

(7) Other financing programs which the initiative deems to be
appropriate. (L. 1997 2d Ex. Sess. S.B. 1 § 4)

Effective 12-23-97

1. Section 135.460 and sections 620.1100 and 620.1103, RSMo,
shall be known and may be cited as the "Youth Opportunities and Violence
Prevention Act".

2. As used in this section, the term "taxpayer" shall include
corporations as defined in section 143.441 or 143.471, RSMo, and
individuals, individual proprietorships and partnerships.

3. A taxpayer shall be allowed a tax credit against the tax otherwise due
pursuant to chapter 143, RSMo, excluding withholding tax imposed by
sections 143.191 to 143.265, RSMo, chapter 147, RSMo, chapter 148, RSMo,
or chapter 153, RSMo, in an amount equal to thirty percent for property
contributions and fifty percent for monetary contributions of the amount
such taxpayer contributed to the programs described in subsection 5 of
this section, not to exceed two hundred thousand dollars per taxable
year, per taxpayer; except as otherwise provided in subdivision (5) of
subsection 5 of this section. The department of economic development
shall prescribe the method for claiming the tax credits allowed in this
section. No rule or portion of a rule promulgated under the authority of
this section shall become effective unless it has been promulgated
pursuant to the provisions of chapter 536, RSMo. All rulemaking authority
delegated prior to June 27, 1997, is of no force and effect and repealed;
however, nothing in this section shall be interpreted to repeal or affect
the validity of any rule filed or adopted prior to June 27, 1997, if such
rule complied with the provisions of chapter 536, RSMo. The provisions of
this section and chapter 536, RSMo, are nonseverable and if any of the
powers vested with the general assembly pursuant to chapter 536, RSMo,
including the ability to review, to delay the effective date, or to
disapprove and annul a rule or portion of a rule, are subsequently held
unconstitutional, then the purported grant of rulemaking authority and
any rule so proposed and contained in the order of rulemaking shall be
invalid and void.

4. The tax credits allowed by this section shall be claimed by the
taxpayer to offset the taxes that become due in the taxpayer's tax period
in which the contribution was made. Any tax credit not used in such tax
period may be carried over the next five succeeding tax periods.

5. The tax credit allowed by this section may only be claimed for
monetary or property contributions to public or private programs
authorized to participate pursuant to this section by the department of
economic development and may be claimed for the development,
establishment, implementation, operation, and expansion of the following
activities and programs:

(1) An adopt-a-school program. Components of the adopt-a-school program
shall include donations for school activities, seminars, and functions;
school-business employment programs; and the donation of property and
equipment of the corporation to the school;

(2) Expansion of programs to encourage school dropouts to reenter and
complete high school or to complete a graduate equivalency degree program;

(3) Employment programs. Such programs shall initially, but not
exclusively, target unemployed youth living in poverty and youth living
in areas with a high incidence of crime;

(4) New or existing youth clubs or associations;

(5) Employment/internship/apprenticeship programs in business or trades
for persons less than twenty years of age, in which case the tax credit
claimed pursuant to this section shall be equal to one-half of the amount
paid to the intern or apprentice in that tax year, except that such
credit shall not exceed ten thousand dollars per person;

(6) Mentor and role model programs;

(7) Drug and alcohol abuse prevention training programs for youth;

(8) Donation of property or equipment of the taxpayer to schools,
including schools which primarily educate children who have been expelled
from other schools, or donation of the same to municipalities, or
not-for-profit corporations or other not-for-profit organizations which
offer programs dedicated to youth violence prevention as authorized by
the department;

(9) Not-for-profit, private or public youth activity centers;

(10) Nonviolent conflict resolution and mediation programs;

(11) Youth outreach and counseling programs.

6. Any program authorized in subsection 5 of this section shall, at least
annually, submit a report to the department of economic development
outlining the purpose and objectives of such program, the number of youth
served, the specific activities provided pursuant to such program, the
duration of such program and recorded youth attendance where applicable.

7. The department of economic development shall, at least annually submit
a report to the Missouri general assembly listing the organizations
participating, services offered and the number of youth served as the
result of the implementation of this section.

8. The tax credit allowed by this section shall apply to all taxable
years beginning after December 31, 1995.

9. For the purposes of the credits described in this section, in the case
of a corporation described in section 143.471, RSMo, partnership, limited
liability company described in section 347.015, RSMo, cooperative,
marketing enterprise, or partnership, in computing Missouri's tax
liability, such credits shall be allowed to the following:

(1) The shareholders of the corporation described in section 143.471,
RSMo;

(2) The partners of the partnership;

(3) The members of the limited liability company; and

(4) Individual members of the cooperative or marketing enterprise. Such
credits shall be apportioned to the entities described in subdivisions
(1) and (2) of this subsection in proportion to their share of ownership
on the last day of the taxpayer's tax period. (L. 1995 H.B. 174, et al.
§§ 11, 12, A.L. 1997 2d Ex. Sess. S.B. 1)

Effective 12-23-97

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

Sections 135.475 to 135.487 shall be known and may be cited as
the "Rebuilding Communities and Neighborhood Preservation Act". (L. 1999
S.B. 20 § 1)

Effective 1-1-00

As used in sections 135.481 to 135.487, the following terms mean:

(1) "Department", the department of economic development;

(2) "Director", the director of the department of economic development;

(3) "Distressed community", as defined in section 135.530;

(4) "Eligible costs for a new residence", expenses incurred for property
acquisition, development, site preparation other than demolition,
surveys, architectural and engineering services and construction and all
other necessary and incidental expenses incurred for constructing a new
market rate residence, which is or will be owner-occupied, which is not
replacing a national register listed or local historic structure; except
that, costs paid for by the taxpayer with grants or forgivable loans,
other than tax credits, provided pursuant to state or federal
governmental programs are ineligible;

(5) "Eligible costs for rehabilitation", expenses incurred for the
renovation or rehabilitation of an existing residence including site
preparation, surveys, architectural and engineering services,
construction, modification, expansion, remodeling, structural alteration,
replacements and alterations; except that, costs paid for by the taxpayer
with grants or forgivable loans other than tax credits provided pursuant
to state or federal governmental programs are ineligible;

(6) "Eligible residence", a single-family residence forty years of age or
older, located in this state and not within a distressed community as
defined by section 135.530, which is occupied or intended to be or
occupied long-term by the owner or offered for sale at market rate for
owner-occupancy and which is either located within a United States census
block group which, if in a metropolitan statistical area, has a median
household income of less than ninety percent, but greater than or equal
to seventy percent of the median household income for the metropolitan
statistical area in which the census block group is located, or which, if
located within a United States census block group in a nonmetropolitan
area, has a median household income of less than ninety percent, but
greater than or equal to seventy percent of the median household income
for the nonmetropolitan areas in the state;

(7) "Flood plain", any land or area susceptible to being inundated by
water from any source or located in a one hundred-year flood plain area
determined by Federal Emergency Management Agency mapping as subject to
flooding;

(8) "New residence", a residence constructed on land which if located
within a distressed community has either been vacant for at least two
years or is or was occupied by a structure which has been condemned by
the local entity in which the structure is located or which, if located
outside of a distressed community but within a census block group as
described in subdivision (6) or (10) of this section, either replaces a
residence forty years of age or older demolished for purposes of
constructing a replacement residence, or which is constructed on vacant
property which has been classified for not less than forty continuous
years as residential or utility, commercial, railroad or other real
property pursuant to article X, section 4(b) of the Missouri
Constitution, as defined in section 137.016, RSMo; except that, no new
residence shall be constructed in a flood plain or on property used for
agricultural purposes. In a distressed community, the term "new
residence" shall include condominiums, owner-occupied units or other
units intended to be owner-occupied in multiple unit structures;

(9) "Project", new construction, rehabilitation or substantial
rehabilitation of a residence that qualifies for a tax credit pursuant to
sections 135.475 to 135.487;

(10) "Qualifying residence", a single-family residence, forty years of
age or older, located in this state which is occupied or intended to be
occupied long-term by the owner or offered for sale at market rate for
owner-occupancy and which is located in a metropolitan statistical area
or nonmetropolitan statistical area within a United States census block
group which has a median household income of less than seventy percent of
the median household income for the metropolitan statistical area or
nonmetropolitan area, respectively, or which is located within a
distressed community. A qualifying residence shall include a condominium
or residence within a multiple residential structure or a structure
containing multiple single-family residences which is located within a
distressed community;

(11) "Substantial rehabilitation", rehabilitation the costs of which
exceed fifty percent of either the purchase price or the cost basis of
the structure immediately prior to rehabilitation; provided that, the
structure is at least fifty years old notwithstanding any provision of
sections 135.475 to 135.487 to the contrary;

(12) "Tax liability", the tax due pursuant to chapter 143, 147 or 148,
RSMo, other than taxes withheld pursuant to sections* 143.191 to 143.265,
RSMo;

(13) "Taxpayer", any person, partnership, corporation, trust or limited
liability company. (L. 1999 S.B. 20 § 2)

Effective 1-1-00

*Word "sections" does not appear in original rolls.

1. (1) Any taxpayer who incurs eligible costs for a new
residence located in a distressed community or within a census block
group as described in subdivision (10) of section 135.478, or for a
multiple unit condominium described in subdivision (2) of this
subsection, shall receive a tax credit equal to fifteen percent of such
costs against his or her tax liability. The tax credit shall not exceed
forty thousand dollars per new residence in any ten-year period.

(2) For the purposes of this section, a "multiple unit condominium" is
one that is intended to be owner occupied, which is constructed on
property subject to an industrial development contract as defined in
section 100.310, RSMo, and which lies within an area with a city zoning
classification of urban redevelopment district established after January
1, 2000, and before December 31, 2001, and which is constructed in
connection with the qualified rehabilitation of a structure more than
ninety years old eligible for the historic structures rehabilitation tax
credit described in sections 253.545 to 253.559, RSMo, and is under way
by January 1, 2000, and completed by January 1, 2002.

2. Any taxpayer who incurs eligible costs for a new residence located
within a census block as described in subdivision (6) of section 135.478
shall receive a tax credit equal to fifteen percent of such costs against
his or her tax liability. The tax credit shall not exceed twenty-five
thousand dollars per new residence in any ten-year period.

3. Any taxpayer who is not performing substantial rehabilitation and who
incurs eligible costs for rehabilitation of an eligible residence or a
qualifying residence shall receive a tax credit equal to twenty-five
percent of such costs against his or her tax liability. The minimum
eligible costs for rehabilitation of an eligible residence shall be ten
thousand dollars. The minimum eligible costs for rehabilitation of a
qualifying residence shall be five thousand dollars. The tax credit shall
not exceed twenty-five thousand dollars in any ten-year period.

4. Any taxpayer who incurs eligible costs for substantial rehabilitation
of a qualifying residence shall receive a tax credit equal to thirty-five
percent of such costs against his or her tax liability. The minimum
eligible costs for substantial rehabilitation of a qualifying residence
shall be ten thousand dollars. The tax credit shall not exceed seventy
thousand dollars in any ten-year period.

5. A taxpayer shall be eligible to receive tax credits for new
construction or rehabilitation pursuant to only one subsection of this
section.

6. No tax credit shall be issued pursuant to this section for any
structure which is in violation of any municipal or county property,
maintenance or zoning code.

7. No tax credit shall be issued pursuant to sections 135.475 to 135.487
for the construction or rehabilitation of rental property. (L. 1999 S.B.
20 § 3, A.L. 2000 H.B. 1238)

1. Beginning January 1, 2000, tax credits shall be allowed
pursuant to section 135.481 in an amount not to exceed sixteen million
dollars per year. Of this total amount of tax credits in any given year,
eight million dollars shall be set aside for projects in areas described
in subdivision (6) of section 135.478 and eight million dollars for
projects in areas described in subdivision (10) of section 135.478. The
maximum tax credit for a project consisting of multiple-unit qualifying
residences in a distressed community shall not exceed three million
dollars.

2. Any amount of credit which exceeds the tax liability of a taxpayer for
the tax year in which the credit is first claimed may be carried back to
any of the taxpayer's three prior tax years and carried forward to any of
the taxpayer's five subsequent tax years. A certificate of tax credit
issued to a taxpayer by the department may be assigned, transferred, sold
or otherwise conveyed. Whenever a certificate of tax credit is assigned,
transferred, sold or otherwise conveyed, a notarized endorsement shall be
filed with the department specifying the name and address of the new
owner of the tax credit and the value of the credit.

3. The tax credits allowed pursuant to sections 135.475 to 135.487 may
not be claimed in addition to any other state tax credits, with the
exception of the historic structures rehabilitation tax credit authorized
pursuant to sections 253.545 to 253.559, RSMo, which insofar as sections
135.475 to 135.487 are concerned may be claimed only in conjunction with
the tax credit allowed pursuant to subsection 4 of section 135.481. In
order for a taxpayer eligible for the historic structures rehabilitation
tax credit to claim the tax credit allowed pursuant to subsection 4 of
section 135.481, the taxpayer must comply with the requirements of
sections 253.545 to 253.559, RSMo, and in such cases, the amount of the
tax credit pursuant to subsection 4 of section 135.481 shall be limited
to the lesser of twenty percent of the taxpayer's eligible costs or forty
thousand dollars. (L. 1999 S.B. 20 § 4, A.L. 2000 S.B. 894)

(2002) Senate Bill 894 provision declared unconstitutional as a violation
of the clear title requirement of Art. III, Section 23. Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc).

1. To obtain any credit allowed pursuant to sections 135.475 to
135.487, a taxpayer shall submit to the department, for preliminary
approval, an application for tax credit. The director shall, upon final
approval of an application and presentation of acceptable proof of
substantial completion of construction, issue the taxpayer a certificate
of tax credit. The director shall issue all credits allowed pursuant to
sections 135.475 to 135.487 in the order the applications are received.
In the case of a taxpayer other than an owner-occupant, the director
shall not delay the issuance of a tax credit pursuant to sections 135.475
to 135.487 until the sale of a residence at market rate for
owner-occupancy. A taxpayer, taxpayer other than an owner-occupant who
receives a certificate of tax credit pursuant to sections 135.475 to
135.487 shall, within thirty days of the date of the sale of a residence,
furnish to the director satisfactory proof that such residence was sold
at market rate for owner- occupancy. If the director reasonably
determines that a residence was not in good faith intended for long-term
owner occupancy, the director make revoke any tax credits issued and seek
recovery of any tax credits issued pursuant to section 620.017, RSMo.

2. The department may cooperate with a municipality or a county in which
a project is located to help identify the location of the project, the
type and eligibility of the project, the estimated cost of the project
and the completion date of the project.

3. The department may promulgate such rules or regulations or issue
administrative guidelines as are necessary to administer the provisions
of sections 135.475 to 135.487. No rule or portion of a rule promulgated
pursuant to the authority of this section shall become effective unless
it has been promulgated pursuant to the provisions of chapter 536, RSMo.

4. The department shall conduct annually a comprehensive program
evaluation illustrating where the tax credits allowed pursuant to
sections 135.475 to 135.487 are being utilized, explaining the economic
impact of such program and making recommendations on appropriate program
modifications to ensure the program's success. (L. 1999 S.B. 20 § 5)

Effective 1-1-00

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

1. In order to encourage and foster community improvement, an
eligible small business, as defined in Section 44 of the Internal Revenue
Code, shall be allowed a credit not to exceed five thousand dollars
against the tax otherwise due pursuant to chapter 143, RSMo, not
including sections 143.191 to 143.265, RSMo, in an amount equal to fifty
percent of all eligible access expenditures exceeding the monetary cap
provided by Section 44 of the Internal Revenue Code. For purposes of this
section, "eligible access expenditures" means amounts paid or incurred by
the taxpayer in order to comply with applicable access requirements
provided by the Americans With Disabilities Act of 1990, as further
defined in Section 44 of the Internal Revenue Code and federal rulings
interpreting Section 44 of the Internal Revenue Code.

2. The tax credit allowed by this section shall be claimed by the
taxpayer at the time such taxpayer files a return. Any amount of tax
credit which exceeds the tax due shall be carried over to any subsequent
taxable year, but shall not be refunded and shall not be transferable.

3. The director of the department of economic development and the
director of the department of revenue shall jointly administer the tax
credit authorized by this section. Both the director of the department of
economic development and the director of the department of revenue are
authorized to promulgate rules and regulations necessary to administer
the provisions of this section. No rule or portion of a rule promulgated
pursuant to the authority of this section shall become effective unless
it has been promulgated pursuant to the provisions of chapter 536, RSMo.

4. The provisions of this section shall become effective on January 1,
2000, and shall apply to all taxable years beginning after December 31,
1999. (L. 1999 H.B. 516 § 1 merged with S.B. 20 § 6, A.L. 2001 H.B. 590)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

1. Sections 135.500 to 135.529 shall be known and may be cited
as the "Missouri Certified Capital Company Law".

2. As used in sections 135.500 to 135.529, the following terms mean:

(1) "Affiliate of a certified company":

(a) Any person, directly or indirectly owning, controlling or holding
power to vote ten percent or more of the outstanding voting securities or
other ownership interests of the Missouri certified capital company;

(b) Any person ten percent or more of whose outstanding voting securities
or other ownership interest are directly or indirectly owned, controlled
or held with power to vote by the Missouri certified capital company;

(c) Any person directly or indirectly controlling, controlled by, or
under common control with the Missouri certified capital company;

(d) A partnership in which the Missouri certified capital company is a
general partner;

(e) Any person who is an officer, director or agent of the Missouri
certified capital company or an immediate family member of such officer,
director or agent;

(2) "Applicable percentage", one hundred percent;

(3) "Capital in a qualified Missouri business", any debt, equity or
hybrid security, of any nature and description whatsoever, including a
debt instrument or security which has the characteristics of debt but
which provides for conversion into equity or equity participation
instruments such as options or warrants which are acquired by a Missouri
certified capital company or a qualified investing entity as a result of
a transfer of cash to a business;

(4) "Certified capital", an investment of cash by an investor in a
Missouri certified capital company;

(5) "Certified capital company", any partnership, corporation, trust or
limited liability company, whether organized on a profit or
not-for-profit basis, that is located, headquartered and registered to
conduct business in Missouri that has as its primary business activity,
the investment of cash in qualified Missouri businesses, and which is
certified by the department as meeting the criteria of sections 135.500
to 135.529;

(6) "Department", the Missouri department of economic development;

(7) "Director", the director of the department of economic development or
a person acting under the supervision of the director;

(8) "Investor", any insurance company that contributes cash;

(9) "Liquidating distribution", payments to investors or to the certified
capital company from earnings;

(10) "Person", any natural person or entity, including a corporation,
general or limited partnership, trust or limited liability company;

(11) "Qualified distribution", any distribution or payment to equity
holders of a certified capital company in connection with the following:

(a) Reasonable costs and expenses of forming, syndicating, managing and
operating the certified capital company;

(b) Management fees for managing and operating the certified capital
company; and

(c) Any increase in federal or state taxes, penalties and interest,
including those related to state and federal income taxes, of equity
owners of a certified capital company which related to the ownership,
management or operation of a certified capital company;

(12) "Qualified investing entity", any partnership, corporation, trust,
or limited liability company, whether organized on a for-profit or
not-for-profit basis, that:

(a) Is registered to do business in this state;

(b) Is a wholly owned subsidiary of a certified capital company or
otherwise affiliated with and under common control with a certified
capital company; and

(c) Has been designated as a qualified investing entity by such certified
capital company.

Such designation shall be effective upon delivery by the certified
capital company of written notice of the designation to the department. A
qualified investing entity may raise debt or equity capital for
investment, but such capital shall not be considered certified capital.
Any qualified investment made by a qualified investing entity after the
effective date of this act* shall be deemed to have been made by a
certified capital company that designated the qualified investing entity
as such; provided that no qualified investment may be deemed to have been
made by more than one certified capital company;

(13) "Qualified investment", the investment of cash by a Missouri
certified capital company or a qualified investing entity in such a
manner as to acquire capital in a qualified Missouri business;

(14) "Qualified Missouri business", an independently owned and operated
business, which is headquartered and located in Missouri and which is in
need of venture capital and cannot obtain conventional financing. Such
business shall have no more than two hundred employees, eighty percent of
which are employed in Missouri. Such business shall be involved in
commerce for the purpose of manufacturing, processing or assembling
products, conducting research and development, or providing services in
interstate commerce, but excluding retail, real estate, real estate
development, insurance and professional services provided by accountants,
lawyers or physicians. At the time a certified capital company or
qualified investing entity makes an initial investment in a business,
such business shall be a small business concern that meets the
requirements of the United States Small Business Administration's
qualification size standards for its venture capital program, as defined
in Section 13 CFR 121.301 (c) of the Small Business Investment Act of
1958, as amended. Any business which is classified as a qualified
Missouri business at the time of the first investment in such business by
a Missouri certified capital company or qualified investing entity shall,
for a period of seven years from the date of such first investment,
remain classified as a qualified Missouri business and may receive
follow-on investments from any Missouri certified capital company or
qualified investing entity and such follow-on investments shall be
qualified investments even though such business may not meet the other
qualifications of this subsection at the time of such follow-on
investments;

(15) "State premium tax liability", any liability incurred by an
insurance company pursuant to the provisions of section 148.320, 148.340,
148.370 or 148.376, RSMo, and any other related provisions, which may
impose a tax upon the premium income of insurance companies after January
1, 1997. (L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess. S.B. 1, A.L. 2003
H.B. 289)

*The emergency clause contained in Section B of H.B. 289, 2003, resulted
in an effective date of July 7, 2003, for certain sections. This section
became effective August 28, 2003.

1. Any investor that makes an investment of certified capital
shall, in the year of investment, earn a vested credit against state
premium tax liability equal to the applicable percentage of the
investor's investment of certified capital. An investor shall be entitled
to take up to ten percent of the vested credit in any taxable year of the
investor. Any time after three years after August 28, 1996, the director,
with the approval of the commissioner of administration, may reduce the
applicable percentage on a prospective basis. Any such reduction in the
applicable percentage by the director shall not have any effect on
credits against state premium tax liability which have been claimed or
will be claimed by any investor with respect to credits which have been
earned and vested pursuant to an investment of certified capital prior to
the effective date of any such change.

2. An insurance company claiming a state premium tax credit earned
through an investment in a certified capital company shall not be
required to pay any additional retaliatory tax levied pursuant to section
375.916, RSMo, as a result of claiming such credit.

3. The credit against state premium tax liability which is described in
subsection 1 of this section may not exceed the state premium tax
liability of the investor for any taxable year. All such credits against
state premium tax liability may be carried forward indefinitely until the
credits are utilized. The maximum amount of certified capital in one or
more certified capital companies for which earned and vested tax credits
will be allowed in any year to any one investor or its affiliates shall
be limited to ten million dollars.

4. Except as provided in subsection 5 of this section, the aggregate
amount of certified capital for which earned and vested credits against
state premium tax liability are allowed for all persons pursuant to
sections 135.500 to 135.529 shall not exceed the following amounts: for
calendar year 1996, $0.00; for calendar year 1997, an amount which would
entitle all Missouri certified capital company investors to take
aggregate credits of five million dollars; and for any year thereafter,
an additional amount to be determined by the director but not to exceed
aggregate credits of ten million dollars for any year with the approval
of the commissioner of administration and reported to the general
assembly as provided in subsection 2 of section 33.282, RSMo, provided
that the amount so determined shall not impair the ability of an investor
with earned and vested credits which have been allowed in previous years
to take them, pursuant to subsection 1 of this section. During any
calendar year in which the limitation described in this subsection will
limit the amount of certified capital for which earned and vested credits
against state premium tax liability are allowed, certified capital for
which credits are allowed will be allocated in order of priority based
upon the date of filing of information described in subdivision (1) of
subsection 5 of section 135.516. Certified capital limited in any
calendar year by the application of the provisions of this subsection
shall be allowed and allocated in the immediately succeeding calendar
year in the order of priority set forth in this subsection. The
department shall make separate allocations of certified capital for which
credits are allowed under the limitations described in this subsection
and under the limitations described in subsection 5 of this section.

5. In addition to the maximum amount pursuant to subsection 4 of this
section, the aggregate amount of certified capital for which earned and
vested credits against state premium tax liability are allowed for
persons pursuant to sections 135.500 to 135.529 shall be the following:
for calendar year 1999 and for any year thereafter, an amount to be
determined by the director which would entitle all Missouri certified
capital company investors to take aggregate credits not to exceed four
million dollars for any year with the approval of the commissioner of
administration and reported to the general assembly as provided in
subsection 2 of section 33.282, RSMo, provided that the amount so
determined shall not impair the ability of an investor with earned and
vested credits which have been allowed in previous years or pursuant to
the provisions of subsection 4 of this section to take them, pursuant to
subsection 1 of this section. For purposes of any requirement regarding
the schedule of qualified investments for certified capital for which
earned and vested credits against state premium tax liability are allowed
pursuant to this subsection only, the definition of a "qualified Missouri
business" as set forth in subdivision (14) of subsection 2 of section
135.500 means a Missouri business that is located in a distressed
community as defined in section 135.530, and meets all of the
requirements of subdivision (14) of subsection 2 of section 135.500.
During any calendar year in which the limitation described in this
subsection limits the amount of additional certified capital for which
earned and vested credits against state premium tax liability are
allowed, additional certified capital for which credits are allowed shall
be allocated in order of priority based upon the date of filing of
information described in subdivision (1) of subsection 5 of section
135.516 with respect to such additional certified capital. The department
shall make separate allocations of certified capital for which credits
are allowed under the limitations described in this subsection and under
the limitations described in subsection 4 of this section. No limitation
applicable to any certified capital company with respect to certified
capital for which credits are allowed pursuant to subsection 4 of this
section shall limit the amount of certified capital for which credits are
allowed pursuant to this subsection. No limitation applicable to any
certified capital company with respect to certified capital for which
credits are allowed pursuant to this subsection shall limit the amount of
certified capital for which credits are allowed pursuant to subsection 4
of this section.

6. The department shall advise any Missouri certified capital company, in
writing, within fifteen days after receiving the filing described in
subdivision (1) of subsection 5 of section 135.516 whether the
limitations of subsection 3 of this section then in effect will be
applicable with respect to the investments and credits described in such
filing with the department. (L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess.
S.B. 1, A.L. 1998 H.B. 1656, A.L. 2003 H.B. 289)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

A Missouri certified capital company shall have a funding period
of one year from the date of receiving certification from the director.
All investments in the Missouri certified capital company shall be made
within such three hundred sixty-five-day funding period. (L. 1996 H.B.
1237)

Effective 1-1-97

The department may certify profit or not for profit entities
which submit an application to be designated as a Missouri certified
capital company. The department shall review the organizational documents
for each applicant for certification and the business history of the
applicant, determine that the Missouri certified capital company's cash,
marketable securities and other liquid assets are at least five hundred
thousand dollars, determine that the liquid asset base for certified
companies is at least five hundred thousand dollars at all times during
the company's participation in the program authorized by sections 135.500
to 135.529, and determine that the officers and the board of directors,
partners, trustees or managers are thoroughly acquainted with the
requirements of sections 135.500 to 135.529. No insurance company which
receives tax credits permitted under sections 135.500 to 135.529 for an
investment in a Missouri certified capital company shall, individually or
with or through one or more affiliates, be a managing general partner of
or control the direction of investments of that Missouri certified
capital company. Within seventy-five days of application, the department
shall either issue the certification and notify the department of revenue
and the director of the department of insurance of such certification or
shall refuse the certification and communicate in detail to the applicant
the grounds for the refusal, including the suggestions for the removal of
those grounds. The department shall be responsible for the administration
of the tax credits authorized by sections 135.500 to 135.529. No rule or
portion of a rule promulgated under the authority of sections 135.500 to
135.529 shall become effective unless it has been promulgated pursuant to
the provisions of chapter 536, RSMo. All rulemaking authority delegated
prior to June 27, 1997, is of no force and effect and repealed; however,
nothing in this section shall be interpreted to repeal or affect the
validity of any rule filed or adopted prior to June 27, 1997, if such
rule complied with the provisions of chapter 536, RSMo. The provisions of
this section and chapter 536, RSMo, are nonseverable and if any of the
powers vested with the general assembly pursuant to chapter 536, RSMo,
including the ability to review, to delay the effective date, or to
disapprove and annul a rule or portion of a rule, are subsequently held
unconstitutional, then the purported grant of rulemaking authority and
any rule so proposed and contained in the order of rulemaking shall be
invalid and void. (L. 1996 H.B. 1237, A.L. 1997 2d Ex. Sess. S.B. 1)

Effective 12-23-97

1. To continue to be certified, a Missouri certified capital
company shall make qualified investments according to the following
schedule:

(1) Within two years after the date on which a Missouri certified capital
company is designated as a Missouri certified capital company at least
twenty-five percent of its certified capital shall be, or have been,
placed in qualified investments;

(2) Within three years after the date on which a Missouri certified
capital company is designated as a Missouri certified capital company at
least forty percent of its certified capital shall be, or have been,
placed in qualified investments;

(3) Within four years after the date on which a Missouri certified
capital company is designated as a Missouri certified capital company, at
least fifty percent of its total certified capital shall be, or have
been, placed in qualified investments. A Missouri certified capital
company may not make an investment in an affiliate of the certified
capital company. For the purposes of this subsection, if a legal entity
is not an affiliate before a certified capital company initially invests
in the entity, it will not be an affiliate if a certified capital company
provides additional investment in such entity subsequent to its initial
investment;

(4) A certified capital company, at least fifteen working days prior to
making what it determines to be an initial qualified investment in a
specific qualified Missouri business, shall certify to the department
that the company in which it or a qualified investing entity proposes to
invest is a qualified Missouri business. The certified capital company
shall state the amount of capital it or a qualified investing entity
intends to invest and the name of the business in which it or a qualified
investing entity intends to invest. The certified capital company shall
also provide to the department an explanation of its determination that
the business meets the definition of a qualified Missouri business. If
the department determines that the business does not meet the definition
of a qualified Missouri business, it shall, within the
fifteen-working-day period prior to the making of the proposed
investment, notify the certified capital company of its determination and
an explanation thereof. If the department fails to notify the certified
capital company with respect to the proposed investment within the
fifteen-working-day period prior to the making of the proposed
investment, the company in which the certified capital company or a
qualified investing entity proposes to invest shall be deemed to be a
qualified Missouri business. If a certified capital company fails to
notify the department prior to making an initial investment in a
business, the department may subsequently determine that the business in
which the certified capital company or a qualified investing entity
invested was not a qualified Missouri business even though the business,
at the time of the investment, met the requirements of subdivision (15)
of subsection 2 of section 135.500;

(5) All certified capital which is not required to be placed in qualified
investments or which has been placed in qualified investments and can be
received by the company, may be held or invested in such manner as the
Missouri certified capital company, in its discretion, deems appropriate.
The proceeds of all certified capital which is received by a certified
capital company after it was originally placed in qualified investments
may be placed again in qualified investments and shall count toward any
requirement in sections 135.500 to 135.529 with respect to placing
certified capital in qualified investments.

2. A certified capital company may make qualified distributions at any
time. In order to make distributions, other than qualified distributions,
a certified capital company must have made cumulative qualified
investments, including those made through a qualified investing entity,
in an amount cumulatively equal to at least one hundred percent of its
certified capital. Cumulative distributions to equity holders, other than
qualified distributions, in excess of the certified capital company's
original certified capital and any additional capital contributions to
the certified capital company shall be subject to audit by a nationally
recognized certified public accounting firm acceptable to the department,
at the expense of the certified capital company. The audit shall
determine whether aggregate cumulative distributions to all investors and
equity holders, other than qualified distributions, when combined with
all tax credits utilized by investors pursuant to sections 135.500 to
135.529, have resulted in an annual internal rate of return of fifteen
percent computed on the sum of total original certified capital of the
certified capital company and any additional capital contributions to the
certified capital company. Twenty-five percent of distributions made,
other than qualified distributions, in excess of the amount required to
produce a fifteen percent annual internal rate of return, as determined
by the audit, shall be payable by the certified capital company to the
Missouri development finance board. Distributions or payments to debt
holders of a certified capital company, however, may be made without
restriction with respect to debt owed to them by a certified capital
company. A debt holder that is also an investor or equity holder of a
certified capital company may receive distributions or payments with
respect to such debt without restriction.

3. No qualified investment may be made at a cost to a Missouri certified
capital company greater than fifteen percent of the total certified
capital under management of the Missouri certified capital company at the
time of investment.

4. Documents and other materials submitted by Missouri certified capital
companies or by businesses for purposes of the continuance of
certification may be deemed "closed records" pursuant to the provisions
of section 620.014, RSMo.

5. Each Missouri certified capital company shall report the following to
the department:

(1) As soon as practicable after the receipt of certified capital, the
name of each investor from which the certified capital was received, the
amount of each investor's investment of certified capital and tax credits
computed without regard to any limitations under subsection 3 of section
135.503, and the date on which the certified capital was received;

(2) On a quarterly basis, the amount of the Missouri certified capital
company's certified capital at the end of the quarter, whether or not the
Missouri certified capital company has invested, together with any
investments made by a qualified investing entity that are deemed to have
been made by the certified capital company, more than fifteen percent of
the total certified capital under management in any one company, and all
qualified investments that the Missouri certified capital company has
made or has been deemed to have been made through a qualified investing
entity;

(3) Each Missouri certified capital company shall provide annual audited
financial statements to the department which include an opinion of an
independent certified public accountant to the department within ninety
days of the close of the fiscal year. At the same time, the certified
capital company shall also provide audited financial statements for any
qualified investing entity that has made qualified investments on its
behalf, unless the financial results of such qualified investing entity
are included in the consolidated financial statements of the certified
capital company. The audit shall address the methods of operation and
conduct of the business of the Missouri certified capital company to
determine if the Missouri certified capital company is complying with the
statutes and program rules and that the funds received by the Missouri
certified capital company have been invested as required within the time
limits provided by sections 135.500 to 135.529. (L. 1996 H.B. 1237, A.L.
1997 2d Ex. Sess. S.B. 1, A.L. 2003 H.B. 289)

In order for investments of a qualifying investing entity to be
counted as qualified investments pursuant to sections 135.500 to 135.529,
each such investment of a qualifying investing entity must have received
prior approval from the department. (L. 2003 H.B. 289)

1. The division of finance of the department of economic
development shall conduct an annual review of each Missouri certified
capital company and any qualified investing entities designated by it to
determine if the Missouri certified capital company is abiding by the
requirements of certifications, to advise the Missouri certified capital
company as to the certification status of its qualified investments and
to ensure that no investment has been made in violation of sections
135.500 to 135.529. The cost of the annual review shall be paid by each
Missouri certified capital company according to a reasonable fee schedule
adopted by the department. The division of finance shall report its
findings to the department as soon as practicable following completion of
the audit.

2. Any material violation of sections 135.500 to 135.529 shall be grounds
for decertification under this section. If the department determines that
a company is not in compliance with any requirements for continuing in
certification, it shall, by written notice, inform the officers of the
company and the board of directors, managers, trustees or general
partners that they may be decertified in one hundred twenty days from the
date of mailing of the notice, unless they correct the deficiencies and
are again in compliance with the requirements for certification.

3. At the end of the one hundred twenty-day grace period, if the Missouri
certified capital company is still not in compliance, the department may
send a notice of decertification to the company and to the directors of
the department of revenue and department of insurance. Decertification of
a Missouri certified capital company prior to the certified capital
company meeting all requirements of subdivisions (1) to (3) of subsection
1 of section 135.516 shall cause the recapture of all premium tax credits
previously claimed by an investor and the forfeiture of all future
credits to be claimed by an investor with respect to its investment in
the certified capital company. Decertification of a Missouri certified
capital company after it has met all requirements of subdivisions (1) to
(3) of subsection 1 of section 135.516 shall cause the forfeiture of
premium tax credits for the taxable year of the investor in which the
decertification arose and for future taxable years with no recapture of
tax credits obtained by an investor with respect to the investor's tax
years which ended before the decertification occurred. Once a certified
capital company has made cumulative qualified investments, including
those made through a qualified investing entity and deemed to have been
made by the certified capital company, in an amount equal to at least one
hundred percent of its certified capital, all future premium tax credits
to be claimed by investors with respect to said certified capital company
pursuant to sections 135.500 to 135.529 shall be nonforfeitable. Once a
certified capital company has made cumulative qualified investments,
including those made through a qualified investing entity and deemed to
have been made by the certified capital company, in an amount equal to at
least one hundred percent of its certified capital and has met all other
requirements under sections 135.500 to 135.529, it shall no longer be
subject to regulation by the department except with respect to the
payment of distributions to the Missouri development finance board. (L.
1996 H.B. 1237, A.L. 2003 H.B. 289)

The department may revoke the certification of a Missouri
certified capital company if any material representation to the
department in connection with the application process proves to have been
falsely made or if the application materially violates any requirement
established by the department pursuant to sections 135.500 to 135.529.
(L. 1996 H.B. 1237)

Effective 1-1-97

All investments for which tax credits are claimed under the
provisions of sections 135.500 to 135.529 shall satisfy the conditions of
being registered or specifically exempt from registration by provisions
or regulations under chapter 409, RSMo. (L. 1996 H.B. 1237)

Effective 1-1-97

1. The tax credit established pursuant to sections 135.500 to
135.529 may be sold or transferred in accordance with regulations adopted
by the department. Any such sale or transfer shall not affect the time
schedule for taking the tax credit, as provided in sections 135.500 to
135.529. Any premium tax credits recaptured pursuant to section 135.520
shall be the liability of the taxpayer which actually claimed the credit.
In approving the sale or transfer of the credit pursuant to this section,
the department may require the transferor or the transferee or both the
transferor and the transferee to execute guarantees or post bonds with
respect to any potential credit recapture.

2. No rule or portion of a rule promulgated under the authority of
sections 135.500 to 135.529 shall become effective unless it has been
promulgated pursuant to the provisions of chapter 536, RSMo. The
department shall make and promulgate emergency rules and regulations
consistent with the provisions of sections 135.500 to 135.529 as are
necessary or useful to carry out the provisions of sections 135.500 to
135.529, pursuant to section 536.025, RSMo.

3. Every final order, decision, license or other official act of the
director pursuant to sections 135.500 to 135.529 is subject to
administrative review in accordance with chapter 621, RSMo. (L. 1996 H.B.
1237)

Effective 1-1-97

For the purposes of sections 100.010, 100.710 and 100.850, RSMo,
sections 135.110, 135.200, 135.258, 135.313, 135.403, 135.405, 135.503,
135.530 and 135.545, section 215.030, RSMo, sections 348.300 and 348.302,
RSMo, and sections 620.1400 to 620.1460*, RSMo, "distressed community"
means either a Missouri municipality within a metropolitan statistical
area which has a median household income of under seventy percent of the
median household income for the metropolitan statistical area, according
to the last decennial census, or a United States census block group or
contiguous group of block groups within a metropolitan statistical area
which has a population of at least two thousand five hundred, and each
block group having a median household income of under seventy percent of
the median household income for the metropolitan area in Missouri,
according to the last decennial census. In addition the definition shall
include municipalities not in a metropolitan statistical area, with a
median household income of under seventy percent of the median household
income for the nonmetropolitan areas in Missouri according to the last
decennial census or a census block group or contiguous group of block
groups which has a population of at least two thousand five hundred each
block group having a median household income of under seventy percent of
the median household income for the nonmetropolitan areas of Missouri,
according to the last decennial census. In metropolitan statistical
areas, the definition shall include areas that were designated as either
a federal empowerment zone; or a federal enhanced enterprise community;
or a state enterprise zone that was originally designated before January
1, 1986, but shall not include expansions of such state enterprise zones
done after March 16, 1988. (L. 1998 H.B. 1656, A.L. 1999 S.B. 20, A.L.
2004 S.B. 1155)

*Sections 620.1400 to 620.1460 were repealed by S.B. 1155 in 2004.

1. A corporation, limited liability corporation, partnership or
sole proprietorship, which moves its operations from outside Missouri or
outside a distressed community into a distressed community, or which
commences operations in a distressed community on or after January 1,
1999, and in either case has more than seventy-five percent of its
employees at the facility in the distressed community, and which has
fewer than one hundred employees for whom payroll taxes are paid, and
which is a manufacturing, biomedical, medical devices, scientific
research, animal research, computer software design or development,
computer programming, including Internet, web hosting, and other
information technology, wireless or wired or other telecommunications or
a professional firm shall receive a forty percent credit against income
taxes owed pursuant to chapter 143, 147 or 148, RSMo, other than taxes
withheld pursuant to sections 143.191 to 143.265, RSMo, for each of the
three years after such move, if approved by the department of economic
development, which shall issue a certificate of eligibility if the
department determines that the taxpayer is eligible for such credit. The
maximum amount of credits per taxpayer set forth in this subsection shall
not exceed one hundred twenty-five thousand dollars for each of the three
years for which the credit is claimed. The department of economic
development, by means of rule or regulation promulgated pursuant to the
provisions of chapter 536, RSMo, shall assign appropriate North American
Industry Classification System numbers to the companies which are
eligible for the tax credits provided for in this section. Such
three-year credits shall be awarded only one time to any company which
moves its operations from outside of Missouri or outside of a distressed
community into a distressed community or to a company which commences
operations within a distressed community. A taxpayer shall file an
application for certification of the tax credits for the first year in
which credits are claimed and for each of the two succeeding taxable
years for which credits are claimed.

2. Employees of such facilities physically working and earning wages for
that work within a distressed community whose employers have been
approved for tax credits pursuant to subsection 1 of this section by the
department of economic development for whom payroll taxes are paid shall
also be eligible to receive a tax credit against individual income tax,
imposed pursuant to chapter 143, RSMo, equal to one and one-half percent
of their gross salary paid at such facility earned for each of the three
years that the facility receives the tax credit provided by this section,
so long as they were qualified employees of such entity. The employer
shall calculate the amount of such credit and shall report the amount to
the employee and the department of revenue.

3. A tax credit against income taxes owed pursuant to chapter 143, 147 or
148, RSMo, other than the taxes withheld pursuant to sections 143.191 to
143.265, RSMo, in lieu of the credit against income taxes as provided in
subsection 1 of this section, may be taken by such an entity in a
distressed community in an amount of forty percent of the amount of funds
expended for computer equipment and its maintenance, medical laboratories
and equipment, research laboratory equipment, manufacturing equipment,
fiber optic equipment, high speed telecommunications, wiring or software
development expense up to a maximum of seventy-five thousand dollars in
tax credits for such equipment or expense per year per entity and for
each of three years after commencement in or moving operations into a
distressed community.

4. A corporation, partnership or sole partnership, which has no more than
one hundred employees for whom payroll taxes are paid, which is already
located in a distressed community and which expends funds for such
equipment pursuant to subsection 3 of this section in an amount exceeding
its average of the prior two years for such equipment, shall be eligible
to receive a tax credit against income taxes owed pursuant to chapters
143, 147 and 148, RSMo, in an amount equal to the lesser of seventy-five
thousand dollars or twenty-five percent of the funds expended for such
additional equipment per such entity. Tax credits allowed pursuant to
this subsection or subsection 1 of this section may be carried back to
any of the three prior tax years and carried forward to any of the five
tax years.

5. An existing corporation, partnership or sole proprietorship that is
located within a distressed community and that relocates employees from
another facility outside of the distressed community to its facility
within the distressed community, and an existing business located within
a distressed community that hires new employees for that facility may
both be eligible for the tax credits allowed by subsections 1 and 3 of
this section. To be eligible for such tax credits, such a business,
during one of its tax years, shall employ within a distressed community
at least twice as many employees as were employed at the beginning of
that tax year. A business hiring employees shall have no more than one
hundred employees before the addition of the new employees. This
subsection shall only apply to a business which is a manufacturing,
biomedical, medical devices, scientific research, animal research,
computer software design or development, computer programming or
telecommunications business, or a professional firm.

6. Tax credits shall be approved for applicants meeting the requirements
of this section in the order that such applications are received.
Certificates of tax credits issued in accordance with this section may be
transferred, sold or assigned by notarized endorsement which names the
transferee.

7. The tax credits allowed pursuant to subsections 1, 2, 3, 4 and 5 of
this section shall be for an amount of no more than ten million dollars
for each year beginning in 1999. The total maximum credit for all
entities already located in distressed communities and claiming credits
pursuant to subsection 4 of this section shall be seven hundred and fifty
thousand dollars. The department of economic development in approving
taxpayers for the credit as provided for in subsection 6 of this section
shall use information provided by the department of revenue regarding
taxes paid in the previous year, or projected taxes for those entities
newly established in the state, as the method of determining when this
maximum will be reached and shall maintain a record of the order of
approval. Any tax credit not used in the period for which the credit was
approved may be carried over until the full credit has been allowed.

8. A Missouri employer relocating into a distressed community and having
employees covered by a collective bargaining agreement at the facility
from which it is relocating shall not be eligible for the credits in
subsection 1, 3, 4 or 5 of this section, and its employees shall not be
eligible for the credit in subsection 2 of this section if the relocation
violates or terminates a collective bargaining agreement covering
employees at the facility, unless the affected collective bargaining unit
concurs with the move.

9. Notwithstanding any provision of law to the contrary, no taxpayer
shall earn the tax credits allowed in this section and the tax credits
otherwise allowed in section 135.110, or the tax credits, exemptions, and
refund otherwise allowed in sections 135.200, 135.220, 135.225 and
135.245, respectively, for the same business for the same tax period. (L.
1998 H.B. 1656, A.L. 1999 H.B. 701 and S.B. 20, A.L. 2005 S.B. 343)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

A taxpayer shall be allowed a credit for taxes paid pursuant to
chapter 143, 147 or 148, RSMo, in an amount equal to fifty percent of a
qualified investment in transportation development for aviation, mass
transportation, including parking facilities for users of mass
transportation, railroads, ports, including parking facilities and
limited access roads within ports, waterborne transportation, bicycle and
pedestrian paths, or rolling stock located in a distressed community as
defined in section 135.530, and which are part of a development plan
approved by the appropriate local agency. If the department of economic
development determines the investment has been so approved, the
department shall grant the tax credit in order of date received. A
taxpayer may carry forward any unused tax credit for up to ten years and
may carry it back for the previous three years until such credit has been
fully claimed. Certificates of tax credit issued in accordance with this
section may be transferred, sold or assigned by notarized endorsement
which names the transferee. The tax credits allowed pursuant to this
section shall be for an amount of no more than ten million dollars for
each year. This credit shall apply to returns filed for all taxable years
beginning on or after January 1, 1999. Any unused portion of the tax
credit authorized pursuant to this section shall be available for use in
the future by those entities until fully claimed. (L. 1998 H.B. 1656)

Effective 1-1-99

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

For all tax years beginning on or after January 1, 2005, no tax
credits shall be approved, awarded, or issued to any person or entity
claiming any tax credit under section 135.545; if an organization has
been allocated credits for contribution-based credits prior to January 1,
2005, the organization may issue such credits prior to January 1, 2007,
for qualified contributions. (L. 2004 S.B. 1155)

1. As used in this section, the following terms shall mean:

(1) "Contribution", a donation of cash, stock, bonds or other marketable
securities, or real property;

(2) "Shelter for victims of domestic violence", a facility located in
this state which meets the definition of a shelter for victims of
domestic violence pursuant to section 455.200, RSMo, and which meets the
requirements of section 455.220, RSMo;

(3) "State tax liability", in the case of a business taxpayer, any
liability incurred by such taxpayer pursuant to the provisions of chapter
143, RSMo, chapter 147, RSMo, chapter 148, RSMo, and chapter 153, RSMo,
exclusive of the provisions relating to the withholding of tax as
provided for in sections 143.191 to 143.265, RSMo, and related
provisions, and in the case of an individual taxpayer, any liability
incurred by such taxpayer pursuant to the provisions of chapter 143, RSMo;

(4) "Taxpayer", a person, firm, a partner in a firm, corporation or a
shareholder in an S corporation doing business in the state of Missouri
and subject to the state income tax imposed by the provisions of chapter
143, RSMo, or a corporation subject to the annual corporation franchise
tax imposed by the provisions of chapter 147, RSMo, or an insurance
company paying an annual tax on its gross premium receipts in this state,
or other financial institution paying taxes to the state of Missouri or
any political subdivision of this state pursuant to the provisions of
chapter 148, RSMo, or an express company which pays an annual tax on its
gross receipts in this state pursuant to chapter 153, RSMo, or an
individual subject to the state income tax imposed by the provisions of
chapter 143, RSMo.

2. A taxpayer shall be allowed to claim a tax credit against the
taxpayer's state tax liability, in an amount equal to fifty percent of
the amount such taxpayer contributed to a shelter for victims of domestic
violence.

3. The amount of the tax credit claimed shall not exceed the amount of
the taxpayer's state tax liability for the taxable year that the credit
is claimed, and such taxpayer shall not be allowed to claim a tax credit
in excess of fifty thousand dollars per taxable year. However, any tax
credit that cannot be claimed in the taxable year the contribution was
made may be carried over to the next four succeeding taxable years until
the full credit has been claimed.

4. Except for any excess credit which is carried over pursuant to
subsection 3 of this section, a taxpayer shall not be allowed to claim a
tax credit unless the total amount of such taxpayer's contribution or
contributions to a shelter or shelters for victims of domestic violence
in such taxpayer's taxable year has a value of at least one hundred
dollars.

5. The director of public safety shall determine, at least annually,
which facilities in this state may be classified as shelters for victims
of domestic violence. The director of public safety may require of a
facility seeking to be classified as a shelter for victims of domestic
violence whatever information is reasonably necessary to make such a
determination. The director of public safety shall classify a facility as
a shelter for victims of domestic violence if such facility meets the
definition set forth in subsection 1 of this section.

6. The director of public safety shall establish a procedure by which a
taxpayer can determine if a facility has been classified as a shelter for
victims of domestic violence, and by which such taxpayer can then
contribute to such shelter for victims of domestic violence and claim a
tax credit. Shelters for victims of domestic violence shall be permitted
to decline a contribution from a taxpayer. The cumulative amount of tax
credits which may be claimed by all the taxpayers contributing to
shelters for victims of domestic violence in any one fiscal year shall
not exceed two million dollars.

7. The director of public safety shall establish a procedure by which,
from the beginning of the fiscal year until some point in time later in
the fiscal year to be determined by the director of public safety, the
cumulative amount of tax credits are equally apportioned among all
facilities classified as shelters for victims of domestic violence. If a
shelter for victims of domestic violence fails to use all, or some
percentage to be determined by the director of public safety, of its
apportioned tax credits during this predetermined period of time, the
director of public safety may reapportion these unused tax credits to
those shelters for victims of domestic violence that have used all, or
some percentage to be determined by the director of public safety, of
their apportioned tax credits during this predetermined period of time.
The director of public safety may establish more than one period of time
and reapportion more than once during each fiscal year. To the maximum
extent possible, the director of public safety shall establish the
procedure described in this subsection in such a manner as to ensure that
taxpayers can claim all the tax credits possible up to the cumulative
amount of tax credits available for the fiscal year.

8. This section shall become effective January 1, 2000, and shall apply
to all tax years after December 31, 1999. (L. 1997 H.B. 491, A.L. 1999
H.B. 548 merged with S.B. 159)

Effective 1-1-00

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

1. As used in this section, the following terms shall mean:

(1) "Contribution", a donation of cash, stock, bonds or other marketable
securities, or real property;

(2) "Maternity home", a residential facility located in this state
established for the purpose of providing housing and assistance to
pregnant women who are carrying their pregnancies to term, and which is
exempt from income taxation under the United States Internal Revenue Code;

(3) "State tax liability", in the case of a business taxpayer, any
liability incurred by such taxpayer pursuant to the provisions of chapter
143, RSMo, chapter 147, RSMo, chapter 148, RSMo, and chapter 153, RSMo,
exclusive of the provisions relating to the withholding of tax as
provided for in sections 143.191 to 143.265, RSMo, and related
provisions, and in the case of an individual taxpayer, any liability
incurred by such taxpayer pursuant to the provisions of chapter 143, RSMo;

(4) "Taxpayer", a person, firm, a partner in a firm, corporation or a
shareholder in an S corporation doing business in the state of Missouri
and subject to the state income tax imposed by the provisions of chapter
143, RSMo, or a corporation subject to the annual corporation franchise
tax imposed by the provisions of chapter 147, RSMo, or an insurance
company paying an annual tax on its gross premium receipts in this state,
or other financial institution paying taxes to the state of Missouri or
any political subdivision of this state pursuant to the provisions of
chapter 148, RSMo, or an express company which pays an annual tax on its
gross receipts in this state pursuant to chapter 153, RSMo, or an
individual subject to the state income tax imposed by the provisions of
chapter 143, RSMo.

2. A taxpayer shall be allowed to claim a tax credit against the
taxpayer's state tax liability, in an amount equal to fifty percent of
the amount such taxpayer contributed to a maternity home.

3. The amount of the tax credit claimed shall not exceed the amount of
the taxpayer's state tax liability for the taxable year that the credit
is claimed, and such taxpayer shall not be allowed to claim a tax credit
in excess of fifty thousand dollars per taxable year. However, any tax
credit that cannot be claimed in the taxable year the contribution was
made may be carried over to the next four succeeding taxable years until
the full credit has been claimed.

4. Except for any excess credit which is carried over pursuant to
subsection 3 of this section, a taxpayer shall not be allowed to claim a
tax credit unless the total amount of such taxpayer's contribution or
contributions to a maternity home or homes in such taxpayer's taxable
year has a value of at least one hundred dollars.

5. The director of the department of social services shall determine, at
least annually, which facilities in this state may be classified as
maternity homes. The director of the department of social services may
require of a facility seeking to be classified as a maternity home
whatever information is reasonably necessary to make such a
determination. The director of the department of social services shall
classify a facility as a maternity home if such facility meets the
definition set forth in subsection 1 of this section.

6. The director of the department of social services shall establish a
procedure by which a taxpayer can determine if a facility has been
classified as a maternity home, and by which such taxpayer can then
contribute to such maternity home and claim a tax credit. Maternity homes
shall be permitted to decline a contribution from a taxpayer. The
cumulative amount of tax credits which may be claimed by all the
taxpayers contributing to maternity homes in any one fiscal year shall
not exceed two million dollars.

7. The director of the department of social services shall establish a
procedure by which, from the beginning of the fiscal year until some
point in time later in the fiscal year to be determined by the director
of the department of social services, the cumulative amount of tax
credits are equally apportioned among all facilities classified as
maternity homes. If a maternity home fails to use all, or some percentage
to be determined by the director of the department of social services, of
its apportioned tax credits during this predetermined period of time, the
director of the department of social services may reapportion these
unused tax credits to those maternity homes that have used all, or some
percentage to be determined by the director of the department of social
services, of their apportioned tax credits during this predetermined
period of time. The director of the department of social services may
establish more than one period of time and reapportion more than once
during each fiscal year. To the maximum extent possible, the director of
the department of social services shall establish the procedure described
in this subsection in such a manner as to ensure that taxpayers can claim
all the tax credits possible up to the cumulative amount of tax credits
available for the fiscal year.

8. This section shall become effective January 1, 2000, and shall apply
to all tax years after December 31, 1999. (L. 1997 H.B. 491, A.L. 1999
H.B. 548 merged with S.B. 159)

Effective 1-1-00

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

For all tax years beginning on or after January 1, 1999, a grape
grower or wine producer shall be allowed a tax credit against the state
tax liability incurred pursuant to chapter 143, RSMo, exclusive of the
provisions relating to the withholding of tax as provided in sections
143.191 to 143.265, RSMo, in an amount equal to twenty-five percent of
the purchase price of all new equipment and materials used directly in
the growing of grapes or the production of wine in the state. Each grower
or producer shall apply to the department of economic development and
specify the total amount of such new equipment and materials purchased
during the calendar year. The department of economic development shall
certify to the department of revenue the amount of such tax credit to
which a grape grower or wine producer is entitled pursuant to this
section. The provisions of this section notwithstanding, a grower or
producer may only apply for and receive the credit authorized by this
section for five tax periods. (L. 1998 S.B. 827 § 3)

CROSS REFERENCE: Tax Credit Accountability Act of 2004, additional
requirements, RSMo 135.800 to 135.830

1. Beginning January 1, 1999, a taxpayer shall be granted a tax
credit against the tax otherwise due pursuant to chapter 143, RSMo,
excluding withholding tax imposed by sections 143.191 to 143.261, RSMo,
or chapter 148, RSMo, for up to fifty percent of the amount of investment
in production or production-related activities in a qualified film
production project. As used in this section, the term "taxpayer" means an
individual, a partnership, or a corporation as described in section
143.441, 143.471, RSMo, or section 148.370, RSMo, and the term "qualified
film production project" means any film production project with an
expected in-state expenditure budget in excess of three hundred thousand
dollars. Each film production company shall be limited to one qualified
film production project per year. Activities qualifying a taxpayer for
the tax credit pursuant to this subsection shall be approved by the
office of the Missouri film commission and the department of economic
development.

2. Taxpayers shall apply for the film production tax credit by submitting
an application to the department of economic development, on a form
provided by the department. As part of the application, the expected
in-state expenditures of the qualified film production project shall be
documented. In addition, the application shall include an economic impact
statement, showing the economic impact from the activities of the film
production project. Such economic impact statement shall indicate the
impact on the region of the state in which the film production or
production-related activities are located and on the state as a whole.

3. Tax credits certified pursuant to subsection 1 of this section shall
not exceed one million dollars per taxpayer per year, and shall not
exceed a total for all tax credits certified of one million five hundred
thousand dollars per year. Taxpayers may carry forward unused credits for
up to five tax periods, provided all such credits shall be claimed within
ten tax periods following the tax period in which the film production or
production-related activities for which the credits are certified by the
department occurred.

4. Notwithstanding any provision of law to the contrary, any taxpayer may
sell, assign, exchange, convey or otherwise transfer tax credits allowed
in subsection 1 of this section. The taxpayer acquiring the tax credits
may use the acquired credits to offset the tax liabilities otherwise
imposed by chapter 143, RSMo, excluding withholding tax imposed by
sections 143.191 to 143.261, RSMo, or chapter 148, RSMo. Unused acquired
credits may be carried forward for up to five tax periods, provided all
such credits shall be claimed within ten tax periods following the tax
period in which the film production or production-related activities for
which the credits are certified by the department occurred. (L. 1998 S.B.
827 § 2, A.L. 1999 H.B. 701, A.L. 2004 S.B. 1394)

CROSS REFERENCES: Annual report for tax credits, RSMo 320.092 Tax Credit
Accountability Act of 2004, additional requirements, RSMo 135.800 to
135.830

An eligible small business, as defined in Section 44 of the
Internal Revenue Code, shall be allowed a credit against the tax
otherwise due pursuant to chapter 143, RSMo, not including sections
143.191 to 143.265, RSMo, in an amount equal to any amount paid by the
eligible small business to the United States Small Business
Administration as a guaranty fee pursuant to obtaining Small Business
Administration guaranteed financing and to programs administered by the
United States Department of Agriculture for rural development or farm
service agencies. (L. 1999 H.B. 139 § 4, Repealed L. 2000 S.B. 894 § A,
L. 2004 H.B. 1603)

*Senate Bill 894 in 2000 repealed this section. Senate Bill 894 was
declared unconstitutional as a violation of the clear title requirement
of Art. III, Section 23, of the Missouri Constitution (Home Builders of
Greater St. Louis v. State, 75 S.W.3d 267 (Mo.banc 2002)), rendering the
repeal of this section ineffective. House Bill 1603 in 2004 authorized
the reprinting of this section to indicate that this section is still
valid and effective law.

1. The provisions of sections 135.800 to 135.830 shall be known
and may be cited as the "Tax Credit Accountability Act of 2004".

2. As used in sections 135.800 to 135.830, the following terms mean:

(1) "Administering agency", the state agency or department charged with
administering a particular tax credit program, as set forth by the
program's enacting statute; where no department or agency is set forth,
the department of revenue;

(2) "Agricultural tax credits", the agricultural product utilization
contributor tax credit created pursuant to section 348.430, RSMo, the new
generation cooperative incentive tax credit created pursuant to section
348.432, RSMo, and the wine and grape production tax credit created
pursuant to section 135.700;

(3) "All tax credit programs", the tax credit programs included in the
definitions of agricultural tax credits, business recruitment tax
credits, community development tax credits, domestic and social tax
credits, entrepreneurial tax credits, environmental tax credits, housing
tax credits, redevelopment tax credits, and training and educational tax
credits;

(4) "Business recruitment tax credits", the business facility tax credit
created pursuant to sections 135.110 to 135.150 and section 135.258, the
enterprise zone tax benefits created pursuant to sections 135.200 to
135.270, the business use incentives for large-scale development programs
created pursuant to sections 100.700 to 100.850, RSMo, the development
tax credits created pursuant to sections 32.100 to 32.125, RSMo, the
rebuilding communities tax credit created pursuant to section 135.535,
and the film production tax credit created pursuant to section 135.750;

(5) "Community development tax credits", the neighborhood assistance tax
credit created pursuant to sections 32.100 to 32.125, RSMo, the family
development account tax credit created pursuant to sections 208.750 to
208.775, RSMo, the dry fire hydrant tax credit created pursuant to
section 320.093, RSMo, and the transportation development tax credit
created pursuant to section 135.545;

(6) "Domestic and social tax credits", the youth opportunities tax credit
created pursuant to section 135.460 and sections 620.1100 to 620.1103,
RSMo, the shelter for victims of domestic violence created pursuant to
section 135.550, the senior citizen or disabled person property tax
credit created pursuant to sections 135.010 to 135.035, the special needs
adoption tax credit created pursuant to sections 135.325 to 135.339, the
maternity home tax credit created pursuant to section 135.600, and the
shared care tax credit created pursuant to section 660.055, RSMo;

(7) "Entrepreneurial tax credits", the capital tax credit created
pursuant to sections 135.400 to 135.429, the certified capital company
tax credit created pursuant to sections 135.500 to 135.529, the seed
capital tax credit created pursuant to sections 348.300 to 348.318, RSMo,
the new enterprise creation tax credit created pursuant to sections
620.635 to 620.653, RSMo, the research tax credit created pursuant to
section 620.1039, RSMo, the small business incubator tax credit created
pursuant to section 620.495, RSMo, the guarantee fee tax credit created
pursuant to section 135.766, and the new generation cooperative tax
credit created pursuant to sections 32.105 to 32.125, RSMo;

(8) "Environmental tax credits", the charcoal producer tax credit created
pursuant to section 135.313, the wood energy tax credit created pursuant
to sections 135.300 to 135.311, and the manufacturing and recycling
flexible cellulose casing tax credit created pursuant to section 260.285,
RSMo;

(9) "Housing tax credits", the neighborhood preservation tax credit
created pursuant to sections 135.475 to 135.487, the low-income housing
tax credit created pursuant to sections 135.350 to 135.363, and the
affordable housing tax credit created pursuant to sections 32.105 to
32.125, RSMo;

(10) "Recipient", the individual or entity who is the original applicant
for and who receives proceeds from a tax credit program directly from the
administering agency, the person or entity responsible for the reporting
requirements established in section 135.805;

(11) "Redevelopment tax credits", the historic preservation tax credit
created pursuant to sections 253.545 to 253.561, RSMo, the brownfield
redevelopment program tax credit created pursuant to sections 447.700 to
447.718, RSMo, the community development corporations tax credit created
pursuant to sections 135.400 to 135.430, the infrastructure tax credit
created pursuant to subsection 6 of section 100.286, RSMo, the bond
guarantee tax credit created pursuant to section 100.297, RSMo, and the
disabled access tax credit created pursuant to section 135.490;

(12) "Training and educational tax credits", the community college new
jobs tax credit created pursuant to sections 178.892 to 178.896, RSMo,
the skills development account tax credit created pursuant to sections
620.1400 to 620.1460, RSMo, the mature worker tax credit created pursuant
to section 620.1560, RSMo, and* the sponsorship and mentoring tax credit
created pursuant to section 135.348. (L. 2004 S.B. 1099)

*Word "and" does not appear in original rolls.

1. Beginning January 1, 2005, all applications for all tax
credit programs shall include, in addition to any requirements provided
by the enacting statutes of a particular credit program, the following
information to be submitted to the department administering the tax
credit:

(1) Name, address, and phone number of the applicant or applicants, and
the name, address, and phone number of a contact person or agent for the
applicant or applicants;

(2) Taxpayer type, whether individual, corporation, nonprofit or other,
and taxpayer identification number, if applicable;

(3) Standard industry code, if applicable; and

(4) Program name and type of tax credit, including the identity of any
other state or federal program being utilized for the same activity or
project.

2. In addition to the information required by subsection 1 of this
section, an applicant for a community development tax credit shall also
provide information detailing the title and location of the corresponding
project, the estimated time period for completion of the project, and all
geographic areas impacted by the project.

3. In addition to the information required by subsection 1 of this
section, an applicant for a redevelopment tax credit shall also provide
information detailing the location and legal description of the property,
age of the structure, if applicable, whether the property is residential,
commercial, or governmental, and the projected project cost, labor cost,
and projected date of completion. Where a redevelopment tax credit
applicant is required to submit contemporaneously a federal application
for a similar credit on the same underlying project, the submission of a
copy of the federal application shall be sufficient to meet the
requirements of this subsection.

4. In addition to the information required by subsection 1 of this
section, an applicant for a business recruitment tax credit shall also
provide information detailing the category of business by size, the
address of the business headquarters and all offices located within this
state, the number of employees at the time of the application, the number
of employees projected to increase as a result of the completion of the
project, and the estimated project cost.

5. In addition to the information required by subsection 1 of this
section, an applicant for a training and educational tax credit shall
also provide information detailing the name and address of the
educational institution to be used, the average salary of workers to be
served, the estimated project cost, and the number of employees and
number of students to be served.

6. In addition to the information required by subsection 1 of this
section, an applicant for a housing tax credit also shall provide
information detailing the address, legal description, and fair market
value of the property, and the projected labor cost and projected
completion date of the project. Where a housing tax credit applicant is
required to submit contemporaneously a federal application for a similar
credit on the same underlying project, the submission of a copy of the
federal application shall be sufficient to meet the requirements of this
subsection. For the purposes of this subsection, "fair market value"
means the value as of the purchase of the property or the most recent
assessment, whichever is more recent.

7. In addition to the information required by subsection 1 of this
section, an applicant for an entrepreneurial tax credit shall also
provide information detailing the amount of investment and the names of
the project, fund, and research project.

8. In addition to the information required by subsection 1 of this
section, an applicant for an agricultural tax credit shall also provide
information detailing the type of agricultural commodity, the amount of
contribution, the type of equipment purchased, and the name and
description of the* facility.

9. In addition to the information required by subsection 1 of this
section, an applicant for an environmental tax credit shall also include
information detailing the type of equipment, if applicable, purchased and
any environmental impact statement, if required by state or federal law.

10. An administering agency may, by rule, require additional information
to be submitted by an applicant. Any rule or portion of a rule, as that
term is defined in section 536.010, RSMo, that is created pursuant to the
authority delegated in this section shall become effective only if it
complies with and is subject to all of the provisions of chapter 536,
RSMo, and if applicable, section 536.028, RSMo. This section and chapter
536, RSMo, are nonseverable and if any of the powers vested with the
general assembly pursuant to chapter 536, RSMo, to review, to delay the
effective date or to disapprove and annul a rule are subsequently held
unconstitutional, then the grant of rulemaking authority and any rule
proposed or adopted after August 28, 2004, shall be void.

11. Where the sole requirement for receiving a tax credit in the enabling
legislation of any tax credit is an obligatory assessment upon a taxpayer
or a monetary contribution to a particular group or entity, the
application requirements provided in this section shall apply to the
recipient of such assessment or contribution and shall not apply to the
assessed nor the contributor.

12. It shall be the duty of each administering agency to provide
information to every applicant, at some time prior to authorization of an
applicant's tax credit application, wherein the requirements of this
section, the annual reporting requirements of section 135.805, and the
penalty provisions of section 135.810 are described in detail. (L. 2004
S.B. 1099)

*Word "the" does not appear in original rolls.

1. A recipient of a community development tax credit shall
annually, for a period of three years following issuance of tax credits,
provide to the administering agency information confirming the title and
location of the corresponding project, the estimated or actual time
period for completion of the project, and all geographic areas impacted
by the project.

2. A recipient of a redevelopment tax credit shall annually, for a period
of three years following issuance of tax credits, provide to the
administering agency information confirming whether the property is used
for residential, commercial, or governmental purposes, and the projected
or actual project cost, labor cost, and date of completion.

3. A recipient of a business recruitment tax credit shall annually, for a
period of three years following issuance of tax credits, provide to the
administering agency information confirming the category of business by
size, the address of the business headquarters and all offices located
within this state, the number of employees at the time of the annual
update, an updated estimate of the number of employees projected to
increase as a result of the completion of the project, and the estimated
or actual project cost.

4. A recipient of a training and educational tax credit shall annually,
for a period of three years following issuance of tax credits, provide to
the administering agency information confirming the name and address of
the educational institution used, the average salary of workers served as
of such annual update, the estimated or actual project cost, and the
number of employees and number of students served as of such annual
update.

5. A recipient of a housing tax credit shall annually, for a period of
three years following issuance of tax credits, provide to the
administering agency information confirming the address of the property,
the fair market value of the property, as defined in subsection 6 of
section 135.802, and the projected or actual labor cost and completion
date of the project.

6. A recipient of an entrepreneurial tax credit shall annually, for a
period of three years following issuance of tax credits, provide to the
administering agency information confirming the amount of investment and
the names of the project, fund, and research project.

7. A recipient of an agricultural tax credit shall annually, for a period
of three years following issuance of tax credits, provide to the
administering agency information confirming the type of agricultural
commodity, the amount of contribution, the type of equipment purchased,
and the name and description of the* facility, except that if the
agricultural credit is issued as a result of a producer member investing
in a new generation processing entity then the new generation processing
entity, and not the recipient, shall annually, for a period of three
years following issuance of tax credits, provide to the administering
agency information confirming the type of agricultural commodity, the
amount of contribution, the type of equipment purchased, and the name and
description of the* facility.

8. A recipient of an environmental tax credit shall annually, for a
period of three years following issuance of tax credits, provide to the
administering agency information detailing any change to the type of
equipment purchased, if applicable, and any change to any environmental
impact statement, if such statement is required by state or federal law.

9. The reporting requirements established in this section shall be due
annually on June thirtieth of each year. No person or entity shall be
required to make an annual report until at least one year after the
credit issuance date.

10. Where the sole requirement for receiving a tax credit in the enabling
legislation of any tax credit is an obligatory assessment upon a taxpayer
or a monetary contribution to a particular group or entity, the reporting
requirements provided in this section shall apply to the recipient of
such assessment or contribution and shall not apply to the assessed nor
the contributor.

11. Where the enacting statutes of a particular tax credit program or the
rules of a particular administering agency require reporting of
information that includes the information required in sections 135.802 to
135.810, upon reporting of the required information, the applicant shall
be deemed to be in compliance with the requirements of sections 135.802
to 135.810. The administering agency shall notify in writing the
department of economic development of the administering agency's status
as custodian of any particular tax credit program and that all records
pertaining to the program are available at the administering agency's
office for review by the department of economic development.

12. The provisions of subsections 1 to 10 of this section shall apply
beginning on June 30, 2005. (L. 2004 S.B. 1099)

*Word "the" does not appear in original rolls.

1. After credits have been issued, any failure to meet the
annual reporting requirements established in section 135.805 or any
determination of fraud in the application process shall result in
penalties as follows:

(1) Failure to report for more than six months but less than one year
shall result in a penalty equal to two percent of the value of the
credits issued for each month of delinquency during such time period;

(2) Failure to report for more than one year shall result in a penalty
equal to ten percent of the value of the credits issued for each month of
delinquency during such time period up to one hundred percent of the
value of the credit issued is assessed by way of penalty;

(3) Fraud in the application process shall result in a penalty equal to
one hundred percent of the credits issued. No taxpayer shall be deemed to
have committed fraud in the application process for any credit unless
such conclusion has been reached by a court of competent jurisdiction or
the administrative hearing commission.

2. Ninety days after the annual report is past due, the administering
agency shall send notice by registered mail to the last known address of
the person or entity obligated to complete the annual reporting informing
such person or entity of the past-due annual report and describing in
detail the pending penalties and their respective deadlines. Six months
after the annual report is past due, the administering agency shall
notify the department of revenue of any taxpayer subject to penalties.
The taxpayer shall be liable for any penalties as of December
thirty-first of any tax year and such liability shall be due as of the
filing date of the taxpayer's next income tax return. If the taxpayer is
not required to file an income tax return, the taxpayer's liability for
penalties shall be due as of April fifteenth of each year. The director
of the department of revenue shall prepare forms and promulgate rules to
allow for the reporting and satisfaction of liability for such penalties.
The director of the department of revenue shall offset any credits
claimed on a contemporaneously filed tax return against an outstanding
penalty before applying such credits to the tax year against which they
were originally claimed. Any nonpayment of liability for penalties shall
be subject to the same provisions of law as a liability for unpaid income
taxes, including, but not limited to, interest and penalty provisions.

3. Penalties shall remain the liability of the person or entity obligated
to complete the annual reporting, without regard to any transfer of the
credits.

4. Any person or entity obligated to complete the annual reporting
requirements provided in section 135.805 shall provide the proper
administering agency with notice of change of address when necessary.

5. An administering agency may promulgate rules in order to implement the
provisions of this section. Any rule or portion of a rule, as that term
is defined in section 536.010, RSMo, that is created under the authority
delegated in this section shall become effective only if it complies with
and is subject to all of the provisions of chapter 536, RSMo, and, if
applicable, section 536.028, RSMo. This section and chapter 536, RSMo,
are nonseverable and if any of the powers vested with the general
assembly pursuant to chapter 536, RSMo, to review, to delay the effective
date, or to disapprove and annul a rule are subsequently held
unconstitutional, then the grant of rulemaking authority and any rule
proposed or adopted after August 28, 2004, shall be invalid and void. (L.
2004 S.B. 1099)

Prior to authorization of any tax credit application, an
administering agency shall verify through the department of revenue that
the tax credit applicant does not owe any delinquent income, sales, or
use taxes, or interest or penalties on such taxes, and through the
department of insurance that the applicant does not owe any delinquent
insurance taxes. Such delinquency shall not affect the authorization of
the application for such tax credits, except that the amount of credits
issued shall be reduced by the applicant's tax delinquency. If the
department of revenue or the department of insurance concludes that a
taxpayer is delinquent after June fifteenth but before July first of any
year, and the application of tax credits to such delinquency causes a tax
deficiency on behalf of the taxpayer to arise, then the taxpayer shall be
granted thirty days to satisfy the deficiency in which interest,
penalties, and additions to tax shall be tolled. After applying all
available credits towards a tax delinquency, the administering agency
shall notify the appropriate department, and that department shall update
the amount of outstanding delinquent tax owed by the applicant. If any
credits remain after satisfying all insurance, income, sales, and use tax
delinquencies, the remaining credits shall be issued to the applicant,
subject to the restrictions of other provisions of law. (L. 2004 S.B.
1099)

1. The administering agencies for all tax credit programs shall,
in cooperation with the department of revenue, implement a system for
tracking the amount of tax credits authorized, issued, and redeemed. Any
such agency may promulgate rules for the implementation of this section.

2. The provisions of this section shall not apply to any credit that is
issued and redeemed simultaneously.

3. Any rule or portion of a rule, as that term is defined in section
536.010, RSMo, that is created under the authority delegated in this
section shall become effective only if it complies with and is subject to
all of the provisions of chapter 536, RSMo, and, if applicable, section
536.028, RSMo. This section and chapter 536, RSMo, are nonseverable and
if any of the powers vested with the general assembly pursuant to chapter
536, RSMo, to review, to delay the effective date, or to disapprove and
annul a rule are subsequently held unconstitutional, then the grant of
rulemaking authority and any rule proposed or adopted after August 28,
2004, shall be invalid and void. (L. 2004 S.B. 1099)

The provisions of sections 135.800 to 135.830 shall be
construed, wherever necessary, to be in addition to existing
requirements, duties, or obligations present in other provisions of law,
with regard to all tax credit programs. (L. 2004 S.B. 1099)

As used in sections 135.900 to 135.906, the following terms mean:

(1) "Department", the department of economic development;

(2) "Director", the director of the department of economic development;

(3) "Earned income", all income not derived from retirement accounts,
pensions, or transfer payments;

(4) "New business facility", the same meaning as such term is defined in
section 135.100; except that the term "lease" as used therein shall not
include the leasing of property defined in paragraph (d) of subdivision
(6) of this section;

(5) "Population", all residents living in an area who are not enrolled in
any course at a college or university in the area;

(6) "Revenue-producing enterprise":

(a) Manufacturing activities classified as SICs 20 through 39;

(b) Agricultural activities classified as SIC 025;

(c) Rail transportation terminal activities classified as SIC 4013;

(d) Renting or leasing of residential property to low- and
moderate-income persons as defined in 42 U.S.C.A. 5302(a)(20);

(e) Motor freight transportation terminal activities classified as SIC
4231;

(f) Public warehousing and storage activities classified as SICs 422 and
423 except SIC 4221, miniwarehouse warehousing and warehousing
self-storage;

(g) Water transportation terminal activities classified as SIC 4491;

(h) Airports, flying fields, and airport terminal services classified as
SIC 4581;

(i) Wholesale trade activities classified as SICs 50 and 51;

(j) Insurance carriers activities classified as SICs 631, 632, and 633;

(k) Research and development activities classified as SIC 873, except
8733;

(l) Farm implement dealer activities classified as SIC 5999;

(m) Employment agency activities classified as SIC 7361;

(n) Computer programming, data processing, and other computer-related
activities classified as SIC 737;

(o) Health service activities classified as SICs 801, 802, 803, 804, 806,
807, 8092, and 8093;

(p) Interexchange telecommunications service as defined in section
386.020, RSMo, or training activities conducted by an interexchange
telecommunications company as defined in section 386.020, RSMo;

(q) Recycling activities classified as SIC 5093;

(r) Banking activities classified as SICs 602 and 603;

(s) Office activities as defined in section 135.100, notwithstanding SIC
classification;

(t) Mining activities classified as SICs 10 through 14;

(u) The administrative management of any of the foregoing activities; or

(v) Any combination of any of the foregoing activities;

(7) "SIC", the standard industrial classification as such classifications
are defined in the 1987 edition of the standard industrial classification
manual as prepared by the executive office of the president, office of
management and budget;

(8) "Transfer payments", payments made under Medicaid, Medicare, Social
Security, child support or custody agreements, and separation agreements.
(L. 2004 S.B. 1155)

Expires 8-28-14

1. To qualify as a rural empowerment zone, an area shall meet
all the following criteria:

(1) The area is one of pervasive poverty, unemployment, and general
distress;

(2) At least sixty-five percent of the population has earned income below
eighty percent of the median income of all residents within the state
according to the last decennial census or other appropriate source as
approved by the director;

(3) The population of the area is at least four hundred but not more than
three thousand five hundred at the time of designation as a rural
empowerment zone;

(4) The level of unemployment of persons, according to the most recent
data available from the division of employment security or from the
United States Bureau of Census and approved by the director, within the
area exceeds one and one-half times the average rate of unemployment for
the state of Missouri over the previous twelve months, or the percentage
of area residents employed on a full-time basis is less than fifty
percent of the statewide percentage of residents employed on a full-time
basis;

(5) The area is situated more than ten miles from any existing rural
empowerment zone;

(6) The area is situated in a county of the third classification without
a township form of government and with more than eight thousand nine
hundred twenty-five but less than nine thousand twenty-five inhabitants;
and

(7) The area is not situated in an existing enterprise zone.

2. The governing body of any county in which an area may be designated a
rural empowerment zone shall submit to the department an application
showing that the area complies with the requirements of subsection 1 of
this section. The department shall declare the area a rural empowerment
zone if upon investigation the department finds that the area meets the
requirements of subsection 1 of this section. If the area is found not to
meet the requirements, the governing body shall have the opportunity to
submit another application for designation as a rural empowerment zone
and the department shall designate the area a rural empowerment zone if
upon investigation the department finds that the area meets the
requirements of subsection 1 of this section.

3. There shall be no more than two rural empowerment zones as created
under sections 135.900 to 135.906 in existence at any time. (L. 2004 S.B.
1155)

Expires 8-28-14

All of the Missouri taxable income attributed to a new business
facility in a rural empowerment zone which is earned by a taxpayer
establishing and operating a new business facility located within a rural
empowerment zone shall be exempt from taxation under chapter 143, RSMo,
if such new business facility is responsible for the creation of ten new
full- time jobs in the zone within one year from the date on which the
tax abatement begins. All of the Missouri taxable income attributed to a
revenue-producing enterprise in a rural empowerment zone which is earned
by a taxpayer operating a revenue-producing enterprise located within a
rural empowerment zone and employing nineteen or fewer full-time
employees shall be exempt from taxation under chapter 143, RSMo, if such
revenue-producing enterprise is responsible for the creation of five new
full-time jobs in the zone within one year from the date on which the tax
abatement begins. All of the Missouri taxable income attributed to a
revenue-producing enterprise in a rural empowerment zone which is earned
by a taxpayer operating a revenue-producing enterprise located within a
rural empowerment zone and employing twenty or more full-time employees
shall be exempt from taxation under chapter 143, RSMo, if such
revenue-producing enterprise is responsible for the creation of a number
of new full-time jobs in the zone equal to twenty-five percent of the
number of full-time employees employed by the revenue-producing
enterprise on the date on which tax abatement begins within one year from
the date on which the tax abatement begins. (L. 2004 S.B. 1155 § 135.910)

Expires 8-28-14

The provisions of sections 135.900 to 135.906 shall expire on
August 28, 2014. (L. 2004 S.B. 1155 § 135.911)

The following terms, whenever used in sections 135.950 to
135.970 mean:

(1) "Blighted area", an area which, by reason of the predominance of
defective or inadequate street layout, unsanitary or unsafe conditions,
deterioration of site improvements, improper subdivision or obsolete
platting, or the existence of conditions which endanger life or property
by fire and other causes, or any combination of such factors, retards the
provision of housing accommodations or constitutes an economic or social
liability or a menace to the public health, safety, morals, or welfare in
its present condition and use;

(2) "Board", an enhanced enterprise zone board established pursuant to
section 135.957;

(3) "Commencement of commercial operations" shall be deemed to occur
during the first taxable year for which the new business facility is
first put into use by the taxpayer in the enhanced business enterprise in
which the taxpayer intends to use the new business facility;

(4) "Department", the department of economic development;

(5) "Director", the director of the department of economic development;

(6) "Employee", a person employed by the enhanced business enterprise on:

(a) A regular, full-time basis;

(b) A part-time basis, provided such person is customarily performing
such duties an average of at least twenty hours per week; or

(c) A seasonal basis, provided such person performs such duties for at
least eighty percent of the season customary for the position in which
such person is employed;

(7) "Enhanced business enterprise", an industry or one of a cluster of
industries that is either:

(a) Identified by the department as critical to the state's economic
security and growth; or

(b) Will have an impact on industry cluster development, as identified by
the governing authority in its application for designation of an enhanced
enterprise zone and approved by the department; but excluding gambling
establishments (NAICS industry group 7132), retail trade (NAICS sectors
44 and 45) and food and drinking places (NAICS subsector 722). Service
industries may be eligible only if a majority of its annual revenues will
be derived from services provided out of the state;

(8) "Existing business facility", any facility in this state which was
employed by the taxpayer claiming the credit in the operation of an
enhanced business enterprise immediately prior to an expansion,
acquisition, addition, or replacement;

(9) "Facility", any building used as an enhanced business enterprise
located within an enhanced enterprise zone, including the land on which
the facility is located and all machinery, equipment, and other real and
depreciable tangible personal property acquired for use at and located at
or within such facility and used in connection with the operation of such
facility;

(10) "Governing authority", the body holding primary legislative
authority over a county or incorporated municipality;

(11) "NAICS", the 1997 edition of the North American Industry
Classification System as prepared by the Executive Office of the
President, Office of Management and Budget. Any NAICS sector, subsector,
industry group or industry identified in this section shall include its
corresponding classification in subsequent federal industry
classification systems;

(12) "New business facility", a facility that satisfies the following
requirements:

(a) Such facility is employed by the taxpayer in the operation of an
enhanced business enterprise. Such facility shall not be considered a new
business facility in the hands of the taxpayer if the taxpayer's only
activity with respect to such facility is to lease it to another person
or persons. If the taxpayer employs only a portion of such facility in
the operation of an enhanced business enterprise, and leases another
portion of such facility to another person or persons or does not
otherwise use such other portions in the operation of an enhanced
business enterprise, the portion employed by the taxpayer in the
operation of an enhanced business enterprise shall be considered a new
business facility, if the requirements of paragraphs (b), (c), and (d) of
this subdivision are satisfied;

(b) Such facility is acquired by, or leased to, the taxpayer after
December 31, 2004. A facility shall be deemed to have been acquired by,
or leased to, the taxpayer after December 31, 2004, if the transfer of
title to the taxpayer, the transfer of possession pursuant to a binding
contract to transfer title to the taxpayer, or the commencement of the
term of the lease to the taxpayer occurs after December 31, 2004;

(c) If such facility was acquired by the taxpayer from another taxpayer
and such facility was employed immediately prior to the acquisition by
another taxpayer in the operation of an enhanced business enterprise, the
operation of the same or a substantially similar enhanced business
enterprise is not continued by the taxpayer at such facility; and

(d) Such facility is not a replacement business facility, as defined in
subdivision (16) of this section;

(13) "New business facility employee", an employee of the taxpayer in the
operation of a new business facility during the taxable year for which
the credit allowed by section 135.967 is claimed, except that truck
drivers and rail and barge vehicle operators and other operators of
rolling stock for hire shall not constitute new business facility
employees;

(14) "New business facility investment", the value of real and
depreciable tangible personal property, acquired by the taxpayer as part
of the new business facility, which is used by the taxpayer in the
operation of the new business facility, during the taxable year for which
the credit allowed by 135.967 is claimed, except that trucks,
truck-trailers, truck semitrailers, rail vehicles, barge vehicles,
aircraft and other rolling stock for hire, track, switches, barges,
bridges, tunnels, and rail yards and spurs shall not constitute new
business facility investments. The total value of such property during
such taxable year shall be:

(a) Its original cost if owned by the taxpayer; or

(b) Eight times the net annual rental rate, if leased by the taxpayer.
The net annual rental rate shall be the annual rental rate paid by the
taxpayer less any annual rental rate received by the taxpayer from
subrentals. The new business facility investment shall be determined by
dividing by twelve the sum of the total value of such property on the
last business day of each calendar month of the taxable year. If the new
business facility is in operation for less than an entire taxable year,
the new business facility investment shall be determined by dividing the
sum of the total value of such property on the last business day of each
full calendar month during the portion of such taxable year during which
the new business facility was in operation by the number of full calendar
months during such period;

(15) "Related taxpayer":

(a) A corporation, partnership, trust, or association controlled by the
taxpayer;

(b) An individual, corporation, partnership, trust, or association in
control of the taxpayer; or

(c) A corporation, partnership, trust or association controlled by an
individual, corporation, partnership, trust or association in control of
the taxpayer. "Control of a corporation" shall mean ownership, directly
or indirectly, of stock possessing at least fifty percent of the total
combined voting power of all classes of stock entitled to vote, "control
of a partnership or association" shall mean ownership of at least fifty
percent of the capital or profits interest in such partnership or
association, and "control of a trust" shall mean ownership, directly or
indirectly, of at least fifty percent of the beneficial interest in the
principal or income of such trust; ownership shall be determined as
provided in Section 318 of the Internal Revenue Code of 1986, as amended;

(16) "Replacement business facility", a facility otherwise described in
subdivision (12) of this section, hereafter referred to in this
subdivision as "new facility", which replaces another facility, hereafter
referred to in this subdivision as "old facility", located within the
state, which the taxpayer or a related taxpayer previously operated but
discontinued operating on or before the close of the first taxable year
for which the credit allowed by this section is claimed. A new facility
shall be deemed to replace an old facility if the following conditions
are met:

(a) The old facility was operated by the taxpayer or a related taxpayer
during the taxpayer's or related taxpayer's taxable period immediately
preceding the taxable year in which commencement of commercial operations
occurs at the new facility; and

(b) The old facility was employed by the taxpayer or a related taxpayer
in the operation of an enhanced business enterprise and the taxpayer
continues the operation of the same or substantially similar enhanced
business enterprise at the new facility.

Notwithstanding the preceding provisions of this subdivision, a facility
shall not be considered a replacement business facility if the taxpayer's
new business facility investment, as computed in subdivision (14) of this
section, in the new facility during the tax period for which the credits
allowed in section* 135.967 are claimed exceed one million dollars and if
the total number of employees at the new facility exceeds the total
number of employees at the old facility by at least two;

(17) "Same or substantially similar enhanced business enterprise", an
enhanced business enterprise in which the nature of the products produced
or sold, or activities conducted, are similar in character and use or are
produced, sold, performed, or conducted in the same or similar manner as
in another enhanced business enterprise. (L. 2004 S.B. 1155 § 135.1050)

*Word "section" does not appear in original rolls.

1. For purposes of sections 135.950 to 135.970, an area shall
meet the following criteria in order to qualify as an enhanced enterprise
zone:

(1) The area shall be a blighted area, have pervasive poverty,
unemployment and general distress; and

(2) At least sixty percent of the residents living in the area have
incomes below ninety percent of the median income of all residents:

(a) Within the state of Missouri, according to the last decennial census
or other appropriate source as approved by the director; or

(b) Within the county or city not within a county in which the area is
located, according to the last decennial census or other appropriate
source as approved by the director; and

(3) The resident population of the area shall be at least five hundred
but not more than one hundred thousand at the time of designation as an
enhanced enterprise zone if the area lies within a metropolitan
statistical area, as established by the United States Census Bureau, or
if the area does not lie within a metropolitan statistical area, the
resident population of the area at the time of designation shall be at
least five hundred but not more than forty thousand inhabitants. If the
population of the jurisdiction of the governing authority does not meet
the minimum population requirements set forth in this subdivision, the
population of the area must be at least fifty percent of the population
of the jurisdiction. However, no enhanced enterprise zone shall be
created which consists of the total area within the political boundaries
of a county; and

(4) The level of unemployment of persons, according to the most recent
data available from the United States Bureau of Census and approved by
the director, within the area is equal to or exceeds the average rate of
unemployment for:

(a) The state of Missouri over the previous twelve months; or

(b) The county or city not within a county over the previous twelve
months.

2. Notwithstanding the requirements of subsection 1 of this section to
the contrary, an enhanced enterprise zone may be established in an area
located within a county for which public and individual assistance has
been requested by the governor pursuant to Section 401 of the Robert T.
Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121 et
seq., for an emergency proclaimed by the governor pursuant to section
44.100, RSMo, due to a natural disaster of major proportions, if the area
to be designated is blighted and sustained severe damage as a result of
such natural disaster, as determined by the state emergency management
agency. An application for designation as an enhanced enterprise zone
pursuant to this subsection shall be made before the expiration of one
year from the date the governor requested federal relief for the area
sought to be designated.

3. Notwithstanding the requirements of subsection 1 of this section to
the contrary, an enhanced enterprise zone may be designated in a county
of declining population if it meets the requirements of subdivisions (1),
(3) and either (2) or (4) of subsection 1 of this section. For the
purposes of this subsection, a "county of declining population" is one
that has lost one percent or more of its population as demonstrated by
comparing the most recent decennial census population to the next most
recent decennial census population for the county.

4. In addition to meeting the requirements of subsection 1, 2, or 3 of
this section, an area, to qualify as an enhanced enterprise zone, shall
be demonstrated by the governing authority to have either:

(1) The potential to create sustainable jobs in a targeted industry; or

(2) A demonstrated impact on local industry cluster development. (L. 2004
S.B. 1155 § 135.1055)

1. A governing authority planning to seek designation of an
enhanced enterprise zone shall establish an enhanced enterprise zone
board. The number of members on the board shall be seven. One member of
the board shall be appointed by the school district or districts located
within the area proposed for designation as an enhanced enterprise zone.
One member of the board shall be appointed by other affected taxing
districts. The remaining five members shall be chosen by the chief
elected official of the county or municipality.

2. The school district member and the affected taxing district member
shall each have initial terms of five years. Of the five members
appointed by the chief elected official, two shall have initial terms of
four years, two shall have initial terms of three years, and one shall
have an initial term of two years. Thereafter, members shall serve terms
of five years. Each commissioner shall hold office until a successor has
been appointed. All vacancies shall be filled in the same manner as the
original appointment. For inefficiency or neglect of duty or misconduct
in office, a member of the board may be removed by the applicable
appointing authority.

3. A majority of the members shall constitute a quorum of such board for
the purpose of conducting business and exercising the powers of the board
and for all other purposes. Action may be taken by the board upon a vote
of a majority of the members present.

4. The members of the board annually shall elect a chair from among the
members.

5. The role of the board shall be to conduct the activities necessary to
advise the governing authority on the designation of an enhanced
enterprise zone and any other advisory duties as determined by the
governing authority. The role of the board after the designation of an
enhanced enterprise zone shall be review and assessment of zone
activities as it relates to the annual reports as set forth in section
135.960. (L. 2004 S.B. 1155 § 135.1057)

1. Any governing authority that desires to have any portion of a
city or unincorporated area of a county under its control designated as
an enhanced enterprise zone shall hold a public hearing for the purpose
of obtaining the opinion and suggestions of those persons who will be
affected by such designation. The governing authority shall notify the
director of such hearing at least thirty days prior thereto and shall
publish notice of such hearing in a newspaper of general circulation in
the area to be affected by such designation at least twenty days prior to
the date of the hearing but not more than thirty days prior to such
hearing. Such notice shall state the time, location, date, and purpose of
the hearing. The director, or the director's designee, shall attend such
hearing.

2. After a public hearing is held as required in subsection 1 of this
section, the governing authority may file a petition with the department
requesting the designation of a specific area as an enhanced enterprise
zone. Such petition shall include, in addition to a description of the
physical, social, and economic characteristics of the area:

(1) A plan to provide adequate police protection within the area;

(2) A specific and practical process for individual businesses to obtain
waivers from burdensome local regulations, ordinances, and orders which
serve to discourage economic development within the area to be designated
an enhanced enterprise zone, except that such waivers shall not
substantially endanger the health or safety of the employees of any such
business or the residents of the area;

(3) A description of what other specific actions will be taken to support
and encourage private investment within the area;

(4) A plan to ensure that resources are available to assist area
residents to participate in increased development through self-help
efforts and in ameliorating any negative effects of designation of the
area as an enhanced enterprise zone;

(5) A statement describing the projected positive and negative effects of
designation of the area as an enhanced enterprise zone;

(6) A specific plan to provide assistance to any person or business
dislocated as a result of activities within the enhanced enterprise zone.
Such plan shall determine the need of dislocated persons for relocation
assistance; provide, prior to displacement, information about the type,
location, and price of comparable housing or commercial property; provide
information concerning state and federal programs for relocation
assistance and provide other advisory services to displaced persons.
Public agencies may choose to provide assistance under the Uniform
Relocation and Real Property Acquisition Act, 42 U.S.C. Section 4601, et
seq., to meet the requirements of this subdivision; and

(7) A description or plan that demonstrates the requirements of
subsection 4 of section 135.953.

3. An enhanced enterprise zone designation shall be effective upon such
approval by the department and shall expire in twenty-five years.

4. Each designated enhanced enterprise zone board shall report to the
director on an annual basis regarding the status of the zone and business
activity within the zone. (L. 2004 S.B. 1155 § 135.1060)

1. Improvements made to real property as such term is defined in
section 137.010, RSMo, which are made in an enhanced enterprise zone
subsequent to the date such zone or expansion thereto was designated,
may, upon approval of an authorizing resolution by the governing
authority having jurisdiction of the area in which the improvements are
made, be exempt, in whole or in part, from assessment and payment of ad
valorem taxes of one or more affected political subdivisions.

2. Such authorizing resolution shall specify the percent of the exemption
to be granted, the duration of the exemption to be granted, and the
political subdivisions to which such exemption is to apply and any other
terms, conditions, or stipulations otherwise required. A copy of the
resolution shall be provided to the director within thirty calendar days
following adoption of the resolution by the governing authority.

3. No exemption shall be granted until the governing authority holds a
public hearing for the purpose of obtaining the opinions and suggestions
of residents of political subdivisions to be affected by the exemption
from property taxes. The governing authority shall send, by certified
mail, a notice of such hearing to each political subdivision in the area
to be affected and shall publish notice of such hearing in a newspaper of
general circulation in the area to be affected by the exemption at least
twenty days prior to the hearing but not more than thirty days prior to
the hearing. Such notice shall state the time, location, date, and
purpose of the hearing.

4. Notwithstanding subsection 1 of this section, at least one-half of the
ad valorem taxes otherwise imposed on subsequent improvements to real
property located in an enhanced enterprise zone shall become and remain
exempt from assessment and payment of ad valorem taxes of any political
subdivision of this state or municipality thereof for a period of not
less than ten years following the date such improvements were assessed,
provided the improved properties are used for enhanced business
enterprises.

5. No exemption shall be granted for a period more than twenty-five years
following the date on which the original enhanced enterprise zone was
designated by the department.

6. The provisions of subsection 1 of this section shall not apply to
improvements made to real property begun prior to August 28, 2004.

7. The abatement referred to in this section shall not relieve the
assessor or other responsible official from ascertaining the amount of
the equalized assessed value of all taxable property annually as required
by section 99.855, 99.957, or 99.1042, RSMo, and shall not have the
effect of reducing the payments in lieu of taxes referred to in
subdivision (2) of subsection 1 of section 99.845, RSMo, subdivision (2)
of subsection 3 of section 99.957, RSMo, or subdivision (2) of subsection
3 of section 99.1042, RSMo, unless such reduction is set forth in the
plan approved by the governing body of the municipality pursuant to
subdivision (1) of subsection 1 of section 99.820, section 99.942, or
section 99.1027, RSMo. (L. 2004 S.B. 1155 § 135.1065)

1. A taxpayer who establishes a new business facility may, upon
approval by the department, be allowed a credit, each tax year for up to
ten tax years, in an amount determined as set forth in this section,
against the tax imposed by chapter 143, RSMo, excluding withholding tax
imposed by sections 143.191 to 143.265, RSMo. No taxpayer shall receive
multiple ten-year periods for subsequent expansions at the same facility.

2. Notwithstanding any provision of law to the contrary, any taxpayer who
establishes a new business facility in an enhanced enterprise zone and is
awarded state tax credits under this section may not also receive tax
credits under sections 135.100 to 135.150, sections 135.200 to 135.268,
or section 135.535.

3. No credit shall be issued pursuant to this section unless:

(1) The number of new business facility employees engaged or maintained
in employment at the new business facility for the taxable year for which
the credit is claimed equals or exceeds two; and

(2) The new business facility investment for the taxable year for which
the credit is claimed equals or exceeds one hundred thousand dollars.

4. The annual amount of credits allowed for an approved enhanced business
enterprise shall be the lesser of:

(1) The annual amount authorized by the department for the enhanced
business enterprise, which shall be limited to the projected state
economic benefit, as determined by the department; or

(2) The sum calculated based upon the following:

(a) A credit of four hundred dollars for each new business facility
employee employed within an enhanced enterprise zone;

(b) An additional credit of four hundred dollars for each new business
facility employee who is a resident of an enhanced enterprise zone;

(c) An additional credit of four hundred dollars for each new business
facility employee who is paid by the enhanced business enterprise a wage
that exceeds the average wage paid within the county in which the
facility is located, as determined by the department; and

(d) A credit equal to two percent of new business facility investment
within an enhanced enterprise zone.

5. Prior to January 1, 2007, in no event shall the department authorize
more than four million dollars annually to be issued for all enhanced
business enterprises. After December 31, 2006, in no event shall the
department authorize more than seven million dollars annually to be
issued for all enhanced business enterprises.

6. If a facility, which does not constitute a new business facility, is
expanded by the taxpayer, the expansion shall be considered eligible for
the credit allowed by this section if:

(1) The taxpayer's new business facility investment in the expansion
during the tax period in which the credits allowed in this section are
claimed exceeds one hundred thousand dollars and if the number of new
business facility employees engaged or maintained in employment at the
expansion facility for the taxable year for which credit is claimed
equals or exceeds two, and the total number of employees at the facility
after the expansion is at least two greater than the total number of
employees before the expansion; and

(2) The taxpayer's investment in the expansion and in the original
facility prior to expansion shall be determined in the manner provided in
subdivision (12) of section 135.950.

7. The number of new business facility employees during any taxable year
shall be determined by dividing by twelve the sum of the number of
individuals employed on the last business day of each month of such
taxable year. If the new business facility is in operation for less than
the entire taxable year, the number of new business facility employees
shall be determined by dividing the sum of the number of individuals
employed on the last business day of each full calendar month during the
portion of such taxable year during which the new business facility was
in operation by the number of full calendar months during such period.
For the purpose of computing the credit allowed by this section in the
case of a facility which qualifies as a new business facility under
subsection 6 of this section, and in the case of a new business facility
which satisfies the requirements of paragraph (c) of subdivision (12) of
section 135.950, or subdivision (16) of section 135.950, the number of
new business facility employees at such facility shall be reduced by the
average number of individuals employed, computed as provided in this
subsection, at the facility during the taxable year immediately preceding
the taxable year in which such expansion, acquisition, or replacement
occurred and shall further be reduced by the number of individuals
employed by the taxpayer or related taxpayer that was subsequently
transferred to the new business facility from another Missouri facility
and for which credits authorized in this section are not being earned,
whether such credits are earned because of an expansion, acquisition,
relocation, or the establishment of a new facility.

8. In the case where a new business facility employee who* is a resident
of an enhanced enterprise zone for less than a twelve-month period is
employed for less than a twelve-month period, the credits allowed by
paragraph (b) of subdivision (2) of subsection 4 of this section shall be
determined by multiplying four hundred dollars by a fraction, the
numerator of which is the number of calendar days during the taxpayer's
tax year for which such credits are claimed, in which the employee was a
resident of an enhanced enterprise zone, and the denominator of which is
three hundred ** sixty-five.

9. For the purpose of computing the credit allowed by this section in the
case of a facility which qualifies as a new business facility pursuant to
subsection 6 of this section, and in the case of a new business facility
which satisfies the requirements of paragraph (c) of subdivision (12) of
section 135.950 or subdivision (16) of section 135.950, the amount of the
taxpayer's new business facility investment in such facility shall be
reduced by the average amount, computed as provided in subdivision (12)
of section 135.950 for new business facility investment, of the
investment of the taxpayer, or related taxpayer immediately preceding
such expansion or replacement or at the time of acquisition. Furthermore,
the amount of the taxpayer's new business facility investment shall also
be reduced by the amount of investment employed by the taxpayer or
related taxpayer which was subsequently transferred to the new business
facility from another Missouri facility and for which credits authorized
in this section are not being earned, whether such credits are earned
because of an expansion, acquisition, relocation, or the establishment of
a new facility.

10. For a taxpayer with flow-through tax treatment to its members,
partners, or shareholders, the credit shall be allowed to members,
partners, or shareholders in proportion to their share of ownership on
the last day of the taxpayer's tax period.

11. Credits may not be carried forward but shall be claimed for the
taxable year during which commencement of commercial operations occurs at
such new business facility, and for each of the nine succeeding taxable
years for which the credit is issued.

12. Certificates of tax credit authorized by this section may be
transferred, sold, or assigned by filing a notarized endorsement thereof
with the department that names the transferee, the amount of tax credit
transferred, and the value received for the credit, as well as any other
information reasonably requested by the department. The sale price cannot
be less than seventy-five percent of the par value of such credits.

13. The director of revenue shall issue a refund to the taxpayer to the
extent that the amount of credits allowed in this section exceeds the
amount of the taxpayer's income tax. (L. 2004 S.B. 1155 § 135.1070)

*Word "who" does not appear in original rolls.

**Word "and" appears in original rolls.

The department may adopt such rules, statements of policy,
procedures, forms, and guidelines as may be necessary to carry out the
provisions of sections 135.950 to 135.970. Any rule or portion of a rule,
as that term is defined in section 536.010, RSMo, that is created under
the authority delegated in this section shall become effective only if it
complies with and is subject to all of the provisions of chapter 536,
RSMo, and, if applicable, section 536.028, RSMo. This section and chapter
536, RSMo, are nonseverable and if any of the powers vested with the
general assembly pursuant to chapter 536, RSMo, to review, to delay the
effective date, or to disapprove and annul a rule are subsequently held
unconstitutional, then the grant of rulemaking authority and any rule
proposed or adopted after August 28, 2004, shall be invalid and void. (L.
2004 S.B. 1155 § 135.1075)

After January 1, 2007, all enterprise zones designated before
January 1, 2006, shall be eligible to receive the tax benefits under
sections 135.950 to 135.970. (L. 2004 S.B. 1155 § 135.1078)

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