Program could bring jobs to county

Thursday, November 12, 2009

Nearly two dozen community members attended a Missouri Department of Economic Development (DED) presentation on the Enhanced Enterprise Zone (EEZ) program, which was held at the Cassville City Hall on Nov. 5.

"The EEZ is a tool that Barry County could use," said Barry County Presiding Commissioner Cherry Warren. "It is fairly obvious that this will not affect the county that much, but it could affect other local entities. This is your meeting, not ours.

"We want to get feedback from you regarding how this could play out in your city or part of the county," said Warren. "We want input from you."

Carol Shoemaker, Missouri DED incentive specialist, presented information on the EEZ program, which would allow the county to abate a percentage of a business' taxes.

"This is a new program that was started in 2004," said Shoemaker. "This program allows cities, counties and other entities to create a zone through the state to give companies that want to create jobs in that area tax credits and abatements.

"This program can be used to create new jobs and new investments and to keep jobs close to home," said Shoemaker. "A lot of factories in Missouri have been closing. We are trying to turn that around a little bit and keep some of those jobs here."

Each EEZ must offer new and existing companies at least a 50 percent tax abatement on property expansions that are completed within the boundaries of the zone.

Although qualifying businesses will receive partial abatements on real estate taxes for 10 years, each company that participates in the program will be required to pay 100 percent of its base property taxes and 100 percent of its personal property taxes.

"Missouri has the eighth lowest cost-of-living in the country," said Shoemaker. "Many companies believe it is an ideal place to live and create new jobs. We get calls daily asking about the locations of Enhanced Enterprise Zones. Usually areas that offer an EEZ get the jobs."

EEZs can be established in any area that has a population that is between 500 and 40,000 and average wages are 60 percent of the federal poverty rates. The area must also be a continuous zone and designated as an EEZ for at least 25 years.

The Missouri DED offers special requirements for areas that have been impacted by natural disasters or a 1 percent loss of population.

Although Barry County officials are considering establishing an EEZ that covers the majority of the county, the state requires counties to exempt a small portion from county-wide zones. Officials have not determined which portion of the county will be exempted if the zone is established.

"If you decide to establish an EEZ, after we process your application we will help you bring businesses to your area," said Shoemaker. "We have a website that you can use and a sales team that will be available to come down to help you. Plus, you will have ongoing contact with me."

If county officials decide to move forward in the process of establishing an EEZ, the commission will be required to establish a seven-member board that must include one school district representative, one representative of another local tax district and five individuals appointed by the chief elected official. If a county-wide EEZ is established, Warren will be responsible for appointing the board members.

"The board is an advisory board only," said Shoemaker. "The members are responsible for offering advice on the types of businesses they want to attract and the corporations they feel would benefit the area the most.

"They will also determine the terms of the abatement," said Shoemaker, "the length of time and the percentage of the abatement that will be offered. There is a 50 percent, 10 year minimum requirement."

The EEZ Board can suggest a tiered abatement schedule or recommend the commission establish larger abatements for businesses interested in creating a certain number of jobs within the zone. The county could also offer longer abatements or higher abatement percentages to specific types of companies.

"The more active the board is in developing resolutions, the more successful you will be in bringing businesses in that are better for your area," said Shoemaker.

The Missouri DED has created a list of business types that are not eligible for the EEZ program. The list includes: gambling establishments; retail trade; educational services; religious organizations; and food and drinking establishments.

Service industries can be eligible for the program if more than 50 percent of the business' sales are generated outside Missouri.

If Barry County moves forward in the EEZ process, it will be required to host a public hearing regarding the zone prior to submitting its application to the Missouri DED. The application will be processed within six to eight weeks.

In addition to receiving a 50 percent tax abatement on new construction and improvements, qualifying businesses will be eligible for several state tax credits.

Tax credits can be provided each year for five years when a business invests at least $100,000 to establish new or expand existing facilities to create at least two new jobs or invests $1 million to replace a business facility and creates two new jobs. The participating business is also required to pay at least 50 percent of its employees' health insurance.

"In my mind, this thing is absolutely essential for us to be competitive in recruiting businesses to our area," said Eugene Dilbeck, Cassville Economic Development director. "If we hope to entice businesses to our county, we should do anything we can to provide a benefit to those businesses."

Warren asked individuals interested in providing their thoughts regarding the EEZ to call the county commission at 847-4628.

"We have a lot of people who will be affected by this who are not here tonight," said Warren. "We would like to receive feedback from all of the citizens who will be impacted."

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