Tax Credit for Contribution Program
The Missouri Development Finance Board (the "Board") is authorized by Section 100.286(6) of the Missouri Statutes (the "Tax Credit Statute") to grant a tax credit equal to 50% of any moneys contributed by any taxpayer. The Contribution must be made to one of three "funds" established by the Board's statutes: the "industrial development and reserve fund," the "infrastructure development fund," or the "export finance fund." Contributions to the "industrial development guarantee fund" are not eligible to receive a credit.
THE BOARD'S TAX CREDIT
Upon acceptance of Contributions (the "Contribution") and submission of the necessary forms, the taxpayer making the Contribution (the "Donor") will be issued a certificate evidencing a state tax credit (the "Tax Credits") in an amount equal to 50% of the amount of the Contribution (the "Contribution Proceeds").
Tax Credits are to be taken in the taxpayer's current tax year, although such credit may be carried forward for up to five years. Credits may be sold for not less than 75% or more than 100% of their par value, provided that all credits must be claimed within ten years of the date the Contribution is made.
The Tax Credit Statute entitles the Donor (individuals, estates, trusts, and corporations) to receive a credit upon any tax otherwise due under Chapter 143 (excluding 143.192 to 143.261), Chapter 147, and Chapter 148 of the Missouri Statutes. The exclusions are certain withholding taxes identified in the Tax Credit Statute.
FORM OF APPLICATION
For a copy of the Board's Tax Credit for Contribution Program Application, please contact the Board office. The application should be used by persons wanting to submit a request to the Board for the consideration of the acceptance of Contributions. The Board reserves the right to reject any Contribution. Each Application must be submitted by a public entity (the "Public Entity"). The Board will only consider Applications which have been submitted by a Public Entity and, in the case of any Public Entity created on behalf or for the benefit of another governmental entity, the written approval of the Application by such entity.
THE APPLICATION PROCESS
Preliminary Review of Draft of Completed Application. Once the Application is fully completed, the Applicant should submit three copies of the Application in draft form to the following address:
Missouri Development Finance Board
301 West High St., Room 680
P.O. Box 567
Jefferson City, MO 65102
Within approximately two (2) weeks from the receipt of the Application the Board will prepare a comment letter on the draft Application which will describe any additional information the Board determines is necessary to complete the Application. The Applicant should then address such comments before submitting an executed Application to the Board.
Submission of Completed Application. Once the Application is fully completed (which includes any changes or additional information requested by the Board pursuant to the preceding paragraph), the Applicant should submit to the Board twenty (20) copies of the final executed Application to the address set forth above. If the Executive Director determines that the Application is complete, the Executive Director will schedule the Application for consideration at the Board's next regularly scheduled meeting.
Consideration of the Application. The Board will notify the Applicant as soon as possible of the time and date of the Board meeting. At such meeting the Applicant will be expected to make a complete and detailed presentation concerning the matters covered by the Application. When such presentation is complete the Board shall act upon such Application. The Board reserves the right to postpone any action on the Application and to request additional information the Board determines is necessary to properly consider the Application.
Approval. If the Board approves the Application the Board will adopt a Resolution to the effect that the Application has been Approved by the Board. The Applicant and the Board will then proceed to prepare the Tax Credit Agreement for execution and delivery. This agreement defines the relationship between the Applicant and Board and governs the use of Contributions made available to the Applicant for the Project.
For the Board to accept a Contribution under the Tax Credit Statute the Contribution must be used for a purpose for which the Board was created. The Board's principal statutory mandates are set forth in Sections 100.250 to 100.297 of the Missouri Statutes and in summary authorize the Board to provide assistance for:
- economic development Projects;
- qualified infrastructure facilities; and
- export trade activities within the state.
Contributions Conditioned Upon the Use of Contribution Proceeds for Eligible Projects. In the event a Contribution set forth in an Application is conditioned upon the Board applying the Contribution Proceeds in a specific manner, the Board will review the Application based upon the following criteria to determine whether to accept the Contribution:
- will the Board's use of the Contribution be consistent with the Board's statutory mandates;
- will the impact of the Board's use of the Contribution result in a clearly definable benefit to the State (the Board may require the Applicant to submit a financial forecast evidencing the net economic benefit to the State);
- will the definable benefit to the State be commensurate with or greater than the amount of the tax credit;
- will the Board's use of the Contribution duplicate other public programs or efforts;
- will the Board's use of the Contribution have a material impact upon another person's decision to remain, expand, or locate within the State;
- will the Board's use of the Contribution have a material impact upon the retention or creation of jobs within the State;
- will the Board's use of the Contribution contribute to the expansion of the property tax base of the State;
will the Board's use of the Contribution unduly increase the value of property owned or controlled by the Donors;
- will the Board's use of the Contribution assist in the development of a "blighted area" (as defined by Missouri Statutes);
- will the granting of the tax credit impose a financial hardship upon the general revenues of the State;
- will the granting of the tax credit impose a financial hardship upon the tax revenues otherwise received by the locality and its political subdivisions; and
- are local public entities contributing a commensurate share toward the costs of the Project.
The decision to accept any Contribution with stated conditions will be made by the members of the Board after consideration of the foregoing factors. The Board reserves the right to approve in whole or in part or reject any request and to request any additional it deems necessary.
The Board's statutes grant the Board the authority to apply the Contribution in any manner in which funds deposited into the funds established by the Board's statutes may be used. The Board's statutes generally permit moneys in each of the funds to be used to secure bonds issued by it or other issuers, guarantee loans made by eligible lenders, make loans from moneys in such fund, and with respect to moneys in the infrastructure development fund, make grants to state agencies and local political subdivisions. The Board may also acquire property with such funds, provided such property qualifies as a "Project" within the meaning of the Board's statutes. A Project is defined as follows:
"Infrastructure facilities" means the highways, streets, bridges, water supply and distribution systems, mass transportation facilities and equipment, telecommunication facilities, jails and prisons, sewers and sewage treatment facilities, wastewater treatment facilities, airports, railroads, reservoirs, dams and waterways in this state, acquisition of blighted real estate and the improvements thereon, demolition of existing structures and preparation of sites in anticipation of development, public facilities and any other improvements provided by any form of government or development agency.
"Project" means the purchase, construction, extension, and improvement of real estate, plants, buildings, structures, or facilities, whether or not now in existence, used or to be used primarily as a factory, assembly plant, manufacturing plant, fabricating plant, distribution center, warehouse building, office building, port terminal or facility, transportation and transfer facility, industrial plant, processing plant, commercial or agricultural facility, nursing or retirement facility or combination thereof, recreational facility, cultural facility, public facilities, job training or other vocational training facility, infrastructure facility, video-audio telecommunication conferencing facility, office building, facility for the prevention, reduction, disposal or control of pollution, sewage, or solid waste, facility for conducting export trade activities, or research and development building in connection with any of the facilities defined as a Project in this subdivision. The term "Project" shall also include any improvements, including, but not limited to, road or rail construction, alteration or relocation, and construction of facilities to provide utility service for any of the facilities defined as a project under this subdivision, along with any fixtures, equipment, and machinery, and any demolition and relocation expenses used in connection with any such projects and any capital used to promote and facilitate such facilities and notes payable from anticipated revenue issued by any development agency.
If the Donor is a for-profit private corporation or person the Board will not use the Contribution in a manner which will directly or indirectly benefit the Donor beyond the benefit conferred by the credits unless the Donor demonstrates to the sole satisfaction of the Board that such use is based upon fair market value considerations and is an arms-length transaction from the Donor.
In the event a Public Entity uses any of the Contribution Proceeds to directly benefit a Donor or a private for-profit corporation or business, the Board shall require the Public Entity to impose upon such private business an obligation to reimburse the state for the cost of such credits over a time period determined by the Board. Exceptions to this reimbursement requirement may be made if the Board determines that the Project is of extraordinary benefit to the State of Missouri and that the Project would not be completed but for the Board's Application of the Contribution Proceeds without the requirement of reimbursement.
FEES AND COSTS
Concurrently upon the receipt of each Contribution the Board shall deduct an administrative fee in an amount equal to:
2% of the amount of all authorized Contributions of $1,000,000 or less;
1% of the amount of all authorized Contributions in excess of $1,000,000; and
the Board's actual out-of-pocket legal expenses (the fees and expenses of the Board's counsel) incurred by the Board in the execution and administration of a Tax Credit Agreement.
To request a copy of the Board's Tax Credit for Contribution Program Application, please contact the Board at:
MISSOURI DEVELOPMENT FINANCE BOARD
Harry S Truman State Office Building
P.O. Box 567
Jefferson City, Missouri 65102
Contact Person: Robert V. Miserez
Phone: (573) 751-8479
Fax: (573 526-4418
To e-mail this web page attach the following URL: http://go.missouridevelopment.org/contribution
Business and Community Services
301 W. High Street, Rooms 720, 770 Jefferson City, Missouri 65102
Tel: 800-523-1434 Fax: 573-751-7384 Email: email@example.com