March 29, 2012
Economic Development Committee Aiming to Create Enhanced Enterprise Zone
With 118 Enhanced Enterprise Zones already in place in the state of Missouri, Scotland County currently is on the outside looking it at an incentives program targeting business expansion and growth for communities within the state.
The Memphis Economic Development Committee hopes to change that.
The group met March 21st at the Scotland County Rotary building with Mark Kiesling of the Missouri Department of Economic Development (DED). The DED representative explained the Enhanced Enterprise Zone (EEZ) to committee members and outlined the process to create such a tax benefit program locally.
Enhanced Enterprise Zones are specified geographic areas designated by local governments and certified by the DED. Zone designation is based on certain demographic criteria, the potential to create sustainable jobs in a targeted industry and a demonstrated impact on local industry cluster development.
The program is a joint effort between the local entities that comprise the EEZ and the state of Missouri.
When a new business facility is built or an existing business expands within an EEZ, the owners are eligible to apply for tax benefits.
At the local level, the city and/or county can offer a 50% tax abatement for a minimum of 10 years.
At the state level, the same projects will also receive state tax credits equivalent to up to a 1/2% of the investment cost and up to 2% of the payroll expansion.
To qualify, the new business or expansion project must cost a minimum of $100,000 in new investments and must create at least two jobs. The only other requirement, is the jobs include health care coverage, of which the employer covers at least 50% of the cost.
Kiesling stressed that while a EEZ allows both local and state government to offer the tax incentives, it does not require it.
A governing board is created for each EEZ, and that committee ultimately is responsible for reviewing all applications for the tax incentives and ultimately for approving or disapproving participation for each applicant.
He added that not all businesses are eligible. Gaming establishments, educational services, religious organizations and food and drink establishments are prohibited from participating.
In addittion, each EEZ can further define which businesses qualify for assistance.
Kiesling offered the two EEZs in Adair County as examples. He noted that one only offers tax incentives for new manufacturing business or expansion. The second was created strictly for wind energy suppliers.
"You are totally in control of which types of business you chose to incent," Kiesling said. "This is all defined in the ordinances passed by the local governing bodies where the enhanced enterprise zone is created."
The DED rep indicated that the application process for creating a EEZ lasts approximately three to six months.
The committee members noted that a county-wide EEZ seemed most appealing. That would require involvement of the county commission. None of the commissioners were able to attend the March 21st meeting.
Committee chairman Dr. Harlo Doneslon noted that a EEZ designation for the county would put it on level ground competing with other regions in the state for prospective job expansion and growth.
"We want to be able to offer what other parts of the state already can as far as incentives for business growth and job expansion," he said.