"This legislation provides Missouri with a host of new tools to improve our ability to successfully compete for high paying, high quality, family-supporting jobs," Blunt said. "Missouri must be aggressive to create and attract new jobs and the Quality Jobs Act gives state and local economic developers the means to do just that."
The program is divided into four individual programs each with distinct qualification requirements: The Small Business and Expanding Business Program; the Technology Business Program; the High Impact Projects Program; and the Job Retention Program.
"This is a new and better approach to economic development," Blunt said. "We are not just thinking about job creation. We want to create jobs that have a good wage and provide health care benefits."
In order to qualify for the first three programs, employers must offer basic health insurance for new employees for newly created jobs and pay at least 50 percent of health insurance premiums for all parts of the program. The new jobs that are created must be at or above the county average wage.
Employers would retain a portion of withholding taxes paid by employees who would continue to receive full credit for the portion withheld.
[What this seems to mean is that employers are getting a portion of income tax money from the pay of new employees as an incentive to create the jobs that these new workers are given. This is incredibly clever financing.]
Under the job retention program, companies must have employed at least 1,000 full-time, year-round employees during the two years prior to their program application. The job retention tax credit will be up to 50 percent of the withholding tax generated by the employees at a company for five years with tax credits capped at $750,000 annually with the total annual program cap of $3 million. A company also would be required to make a $70 million investment within two years of making an application for the program and local governments must provide local incentives of at least 50 percent of the new local revenues created by the project for 10 years.
The bill also combines the state's Tax Increment Financing (TIF) cap with the Missouri Downtown Economic Stimulus Act (MODESA) cap at $108 million while the cap for Tax Increment Financing (TIF) will increase from $15 million to $32 million that will allow the Department of Economic Development to continue to use TIFs for redevelopment projects as the current program is nearly at its cap. This change addresses Blunt's concern over past TIF commitments made by the previous administration that may have exceeded the $15 million annual cap. [No mention is made here of regulating the practice of using TIF financing; consequently, "blighted area" probably will continue to mean any area where a developer wants to put his project.
The bill would also allow local voters to determine whether a local sales tax for economic development will be beneficial for their area. Currently, only so-called "charter cities" have this authority. The bill also authorizes the Department of Economic Development to charge the recipient of any tax credit a fee in an amount of up to 2.5 percent of the amount of the tax credits issued. Proceeds from the fees will be used to support the programs. [Local voters should have the sense not to vote for taxes that don't benefit the local area 100%.]