Businesses in MO May See New Incentives Program
JEFFERSON CITY - A new comprehensive business incentive program will soon be available in Missouri.
It consolidates four existing programs into one called Missouri Works, which takes effect August 28. Applications and guidelines became available Thursday.
Mike Downing, acting director of the Missouri Department of Economic Development (DED), said the new program would provide a more streamlined incentive for businesses that are adding jobs around the state.
"It will be a simpler process because it provides consistency in definitions, application processes and reporting, so that would be a great benefit we believe to businesses," said Downing.
Missouri Works will be modeled after the current Quality Jobs program, which offers tax breaks to businesses when they add a certain number of jobs at certain wage levels. But the new program will lower the minimum qualification.
Under Missouri works, a company may qualify for tax credit in three separate scenarios:
- The company creates 10 or more jobs at an average wage of 90 percent or more of the county average wage
- The company creates two or more new jobs in a rural area at an average wage of 90 percent or more of the county average wage, and the company commits at least $100,000 to new capital investment within two years
- The company creates two or more jobs in an enhanced enterprise zone with the wage exceeding 80 percent of the country average wage, and a $100,000 capital investment within two years
Under the current Quality Jobs program, businesses in non-rural areas need to add at least 40 jobs to qualify.
The tax credit for Missouri Works will be capped at $106 million during the 2013 fiscal year, that is $22 million less than the current four programs combined.
"That should not be a concern because we have not met the cap on tax credit on these four existing programs, so we don't see that's going to be an issue," Downing said.
A qualified company may retain an amount equal to the withholding tax for new jobs for five years after the jobs are created. And an existing Missouri business can have six years.
"I do believe the new program is good in that it invests in companies that are already here in Missouri, whereas so many times, they are trying to get companies from out of the state, incentives are gone and they move away," said the owner of Gold Crest Distributing, in Mexico, Mo.
Mel Toellner said the DED has already reached out to his company. Recently, the company announced a plan for expansion, which will add about 20 jobs.
"The plan is to add approximately 30,000 square foot to the north side of the existing building." Toellner said.
The expansion would cost about $1.5 million dollars, he said.
"With a little bit help from them, training and some incentives, and help hopefully from the city, that would make this possible to go forward," Toellner said.
Toellner started Gold Crest Distributing in 1995 with one store and the distributing center in his garage. Now the company has about 70 employees.
It distributes products for wild birds and pets, as well as outdoor goods and gifts throughout the U.S. Gold Crest has its own bird supply brand "Songbird Essentials".
The company makes more than 600 of it own products in Missouri and sells them across the U.S., Canada, Europe and the Caribbean, Toellner said.
By expanding his business, he said, he hopes to add more than just distributing jobs.
"We are trying to find more jobs where we make the items, because those type of jobs allows you to continue to pay more," Toellner said.
He said the company had already attracted several college graduates.
"That's our goal, to provide the type of employment to that can let college graduates come back to a small town and that does not often happen," said Toellner.
For more information about Missouri Works, visit the DED website.