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Enhanced Enterprise Zone in Moniteau County

Enhanced Enterprise Zone in Moniteau County

November 19th, 2017 by David Wilson in Local News

Shown in this October 2017 photo, a new building under construction at Burgers' Smokehouse will add another 40,000-square-feet of floor space to the company's facility south of California, Mo. (Submitted photo)

Moniteau County, except for the Lupus area, was approved as an Enhanced Enterprise Zone (EEZ) several years ago, following an ice and snow storm.

The approval letter received by the Moniteau County Commission was dated Feb. 12, 2012. Since an EEZ cannot include an entire county, the Lupus area was not included.

According to Mike Kelley, president/CEO of Moniteau County Regional Economic Development Council (MRED), the EEZ is a discretionary program, which offers state tax credits (accompanied by local real property tax abatement) to Enhanced Business Enterprises. Tax credits may be provided each year for up to five tax years, after the project begins operation.

But, it's not automatic. To receive tax credits for any of the years, the facility must have been created and maintained at a minimum level.

A new or expanded business facility must have two new employees and $100,000 in new investment. The company must offer health insurance at all times — at least 50 percent of which is paid by the employer — to all full-time employees in Missouri.

Eligible investment expenditures include the original cost of machinery, equipment, furniture, fixtures, land and building, and/or eight times the annual rental rate paid for those. Inventory is not eligible for the state tax credits.

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This tax credit can be applied to Ch. 143 - Income tax, excluding withholding tax. Tax credits can only be applied to tax liability for the year in which they were earned. The tax credits are refundable, or may be transferred, sold or assigned. The sale price cannot be less than 75 percent of the par value of such tax credits.

On the local side, the county EEZ board has the authority to approve local real property tax abatement, according to the criteria outlined in the Moniteau County EEZ Benefit Chart. The seven member board was appointed by the county commission.

"There are examples all over the state, and even in our own county, of those who have actually benefited from Enhanced Enterprise Zones," Kelly said. "Just in our county alone, the list includes Burger's Smokehouse, Koechner Manufacturing, Sydenstricker's Tipton facility, and now, Martin Energy."

The idea behind EEZ is to help a company offset some of the tax burden, through its investment in expansion or location of their business, and hiring of new employees. The object is for the new employees to pay taxes to the various cities and counties. This will then help offset the assistance given to the company in the form of an abatement. An EEZ may last up to 25 years.