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State of Missouri Programs and Tax Incentive Programs

Enterprise Zones Facilitate the expansion of new or existing businesses in Missouri’s 65 enterprise zones. State income tax credits are provided to a business based on the number of new jobs and amount of new investment created at the qualifying facility. The business must have created at least 2 new jobs and $100,000 new investment ($1,000,000 for replacement facilities) at the project site. The business may reduce its total Missouri income tax by up to 100%, the more jobs and investment reated at the qualifying facility, the more Missouri income tax the earned credit can offset.

Industrial Development Bonds Industrial development bonds may be available pending revisions in federal tax law, to finance up to 100% of the cost of fixed assets such as land, buildings, machinery and equipment. Because the interest paid to bond-holders is exempt from federal and Missouri income taxes, these bonds offer lower interest rates to the borrower than conventional financing.

Municipal Bonds Municipalities in Missouri are allowed to issue general obligation and revenue bonds for industrial development purposes, including purchasing, constructing, expanding or improving industrial plants. General obligation bonds require a majority vote of the people, while revenue bonds do not require election approval.

Tax Increment Financing Cities and counties may designate areas to be redeveloped and encourage development by diverting real property tax revenues and 50% of tax revenues to a special allocation fund used to defray development costs.

Environmental Improvement and Energy Resources Authority The Authority can issue tax-exempt bonds or notes to companies for projects that would reduce, prevent, or control the pollution of air or water, or provide for proper solid waste disposal. Bonds may also be issued for the construction or installation of energy producing facilities. Loans up to $75,000 are available to companies for equipment that enables the recovering and recycling of materials. After three years, if all the loan criteria are met, the loan is forgiven and repayment is not required.

Missouri Economic Development, Export and Infrastructure Board The MEDEIB promotes the creation and retention of jobs and expansion of the tax base in Missouri. Through loan guarantees, the Board can guarantee up to 85% of loans made by banks and savings and loans, up to, $400,000 per borrower. MEDEIB can also offer both taxable and tax-exempt industrial development revenue bonds for a variety of financing and refinancing purposes.

Linked Deposit Program The State Treasurer provides linked time deposits of state funds to Missouri lending institutions at 2% to 3% below the one-year Treasury Bill rate. The lender then passes the interest savings on to business borrowers that are able to create or retain at least one new job for each $25,000 borrowed, and that employ ten or more people. In addition, a portion of these linked time deposits are reserved specifically for small businesses with less than ten employees.

Community Development Block Grants Under this program, federal funds may be distributed to cities with populations under 50,000 and counties under 200,000 to enhance economic opportunities. Action Fund Loans for up to 30% of a project, $20,000 per job, or $400,000 are available for businesses which have a cash flow gap due to growth.

Industrial Infrastructure Grants Up to $500,000 are offered to block grant eligible communities to assist in providing public infrastructure such as utilities and roads to support new business locations and expansions.

CDBG Loan Guarantees Of up to 90% of a loan, $20,000 per job, or $400,000 are also available for companies in these areas obtaining funds from a private lender when SEQ or MEDEIB programs have been exhausted.

"Float" Loans Of up to 50% of a project, $30,000 per job, or $5 million per project are provided to offset cash flow problems in the first two years.

SCOCOG's Revolving Loan Funds SCOCOG administers two revolving loan funds. The EDA larger fund is available as a “gap” financing opportunity at lower than market interest rates to bolster job creation and has a maximum loan of $100,000 for no more than 28% of a total project cost. The Microenterprise RLF is for smaller business entrepreneurs starting up or expanding a business and has a maximum loan of $25,000 for no more than 70% of a total project.

Local Banks

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