HOUSE BILL NO. 1777 103RD GENERAL ASSEMBLY
INTRODUCED BY REPRESENTATIVE AMATO.
3920H.01I JOSEPH ENGLER, Chief Clerk
AN ACT To repeal section 99.845, RSMo, and to enact in lieu thereof one new section relating to tax increment financing.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Section 99.845, RSMo, is repealed and one new section enacted in lieu 2 thereof, to be known as section 99.845, to read as follows: 99.845. 1. A municipality, either at the time a redevelopment project is approved or, 2 in the event a municipality has undertaken acts establishing a redevelopment plan and 3 redevelopment project and has designated a redevelopment area after the passage and 4 approval of sections 99.800 to 99.865 but prior to August 13, 1982, which acts are in 5 conformance with the procedures of sections 99.800 to 99.865, may adopt tax increment 6 allocation financing by passing an ordinance providing that after the total equalized assessed 7 valuation of the taxable real property in a redevelopment project exceeds the certified total 8 initial equalized assessed valuation of the taxable real property in the redevelopment project, 9 the ad valorem taxes, and payments in lieu of taxes, if any, arising from the levies upon 10 taxable real property in such redevelopment project by taxing districts and tax rates 11 determined in the manner provided in subsection 2 of section 99.855 each year after the 12 effective date of the ordinance until redevelopment costs have been paid shall be divided as 13 follows: 14 (1) That portion of taxes, penalties and interest levied upon each taxable lot, block, 15 tract, or parcel of real property which is attributable to the initial equalized assessed value of 16 each such taxable lot, block, tract, or parcel of real property in the area selected for the 17 redevelopment project shall be allocated to and, when collected, shall be paid by the county
EXPLANATION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is intended to be omitted from the law. Matter in bold-face type in the above bill is proposed language. HB 1777 2
18 collector to the respective affected taxing districts in the manner required by law in the 19 absence of the adoption of tax increment allocation financing; 20 (2) (a) Payments in lieu of taxes attributable to the increase in the current equalized 21 assessed valuation of each taxable lot, block, tract, or parcel of real property in the area 22 selected for the redevelopment project and any applicable penalty and interest over and above 23 the initial equalized assessed value of each such unit of property in the area selected for the 24 redevelopment project shall be allocated to and, when collected, shall be paid to the municipal 25 treasurer who shall deposit such payment in lieu of taxes into a special fund called the 26 "Special Allocation Fund" of the municipality for the purpose of paying redevelopment costs 27 and obligations incurred in the payment thereof. Beginning August 28, 2014, if the voters in 28 a taxing district vote to approve an increase in such taxing district's levy rate for ad valorem 29 tax on real property, any additional revenues generated within an existing redevelopment 30 project area that are directly attributable to the newly voter-approved incremental increase in 31 such taxing district's levy rate shall not be considered payments in lieu of taxes subject to 32 deposit into a special allocation fund without the consent of such taxing district. Revenues 33 will be considered directly attributable to the newly voter-approved incremental increase to 34 the extent that they are generated from the difference between the taxing district's actual levy 35 rate currently imposed and the maximum voter-approved levy rate at the time that the 36 redevelopment project was adopted. Payments in lieu of taxes which are due and owing shall 37 constitute a lien against the real estate of the redevelopment project from which they are 38 derived and shall be collected in the same manner as the real property tax, including the 39 assessment of penalties and interest where applicable. The municipality may, in the 40 ordinance, pledge the funds in the special allocation fund for the payment of such costs and 41 obligations and provide for the collection of payments in lieu of taxes, the lien of which may 42 be foreclosed in the same manner as a special assessment lien as provided in section 88.861. 43 No part of the current equalized assessed valuation of each lot, block, tract, or parcel of 44 property in the area selected for the redevelopment project attributable to any increase above 45 the total initial equalized assessed value of such properties shall be used in calculating the 46 general state school aid formula provided for in section 163.031 until such time as all 47 redevelopment costs have been paid as provided for in this section and section 99.850. 48 (b) Notwithstanding any provisions of this section to the contrary, for purposes of 49 determining the limitation on indebtedness of local government pursuant to Article VI, 50 Section 26(b) of the Missouri Constitution, the current equalized assessed value of the 51 property in an area selected for redevelopment attributable to the increase above the total 52 initial equalized assessed valuation shall be included in the value of taxable tangible property 53 as shown on the last completed assessment for state or county purposes. HB 1777 3
54 (c) The county assessor shall include the current assessed value of all property within 55 the taxing district in the aggregate valuation of assessed property entered upon the assessor's 56 book and verified pursuant to section 137.245, and such value shall be utilized for the purpose 57 of the debt limitation on local government pursuant to Article VI, Section 26(b) of the 58 Missouri Constitution; 59 (3) For purposes of this section, "levies upon taxable real property in such 60 redevelopment project by taxing districts" shall not include the blind pension fund tax levied 61 under the authority of Article III, Section 38(b) of the Missouri Constitution, or the 62 merchants' and manufacturers' inventory replacement tax levied under the authority of 63 subsection 2 of Section 6 of Article X of the Missouri Constitution, except in redevelopment 64 project areas in which tax increment financing has been adopted by ordinance pursuant to a 65 plan approved by vote of the governing body of the municipality taken after August 13, 1982, 66 and before January 1, 1998. 67 2. In addition to the payments in lieu of taxes described in subdivision (2) of 68 subsection 1 of this section, for redevelopment plans and projects adopted or redevelopment 69 projects approved by ordinance after July 12, 1990, and prior to August 31, 1991, fifty 70 percent of the total additional revenue from taxes, penalties and interest imposed by the 71 municipality, or other taxing districts, which are generated by economic activities within the 72 area of the redevelopment project over the amount of such taxes generated by economic 73 activities within the area of the redevelopment project in the calendar year prior to the 74 adoption of the redevelopment project by ordinance, while tax increment financing remains in 75 effect, but excluding taxes imposed on sales or charges for sleeping rooms paid by transient 76 guests of hotels and motels, taxes levied pursuant to section 70.500, licenses, fees or special 77 assessments other than payments in lieu of taxes and any penalty and interest thereon, or, 78 effective January 1, 1998, taxes levied pursuant to section 94.660, for the purpose of public 79 transportation, shall be allocated to, and paid by the local political subdivision collecting 80 officer to the treasurer or other designated financial officer of the municipality, who shall 81 deposit such funds in a separate segregated account within the special allocation fund. Any 82 provision of an agreement, contract or covenant entered into prior to July 12, 1990, between a 83 municipality and any other political subdivision which provides for an appropriation of other 84 municipal revenues to the special allocation fund shall be and remain enforceable. 85 3. In addition to the payments in lieu of taxes described in subdivision (2) of 86 subsection 1 of this section, for redevelopment plans and projects adopted or redevelopment 87 projects approved by ordinance after August 31, 1991, fifty percent of the total additional 88 revenue from taxes, penalties and interest which are imposed by the municipality or other 89 taxing districts, and which are generated by economic activities within the area of the 90 redevelopment project over the amount of such taxes generated by economic activities within HB 1777 4
91 the area of the redevelopment project in the calendar year prior to the adoption of the 92 redevelopment project by ordinance, while tax increment financing remains in effect, but 93 excluding personal property taxes, taxes imposed on sales or charges for sleeping rooms paid 94 by transient guests of hotels and motels, taxes levied pursuant to section 70.500, taxes levied 95 for the purpose of public transportation pursuant to section 94.660, taxes imposed on sales 96 pursuant to subsection 2 of section 67.1712 for the purpose of operating and maintaining a 97 metropolitan park and recreation district, licenses, fees or special assessments other than 98 payments in lieu of taxes and penalties and interest thereon, any sales tax imposed by a 99 county with a charter form of government and with more than six hundred thousand but fewer 100 than seven hundred thousand inhabitants, for the purpose of sports stadium improvement or 101 levied by such county under section 238.410 for the purpose of the county transit authority 102 operating transportation facilities, or for redevelopment plans and projects adopted or 103 redevelopment projects approved by ordinance after August 28, 2013, taxes imposed on sales 104 under and pursuant to section 67.700 or 650.399 for the purpose of emergency 105 communication systems, shall be allocated to, and paid by the local political subdivision 106 collecting officer to the treasurer or other designated financial officer of the municipality, who 107 shall deposit such funds in a separate segregated account within the special allocation fund. 108 Beginning August 28, 2014, if the voters in a taxing district vote to approve an increase in 109 such taxing district's sales tax or use tax, other than the renewal of an expiring sales or use 110 tax, any additional revenues generated within an existing redevelopment project area that are 111 directly attributable to the newly voter-approved incremental increase in such taxing district's 112 levy rate shall not be considered economic activity taxes subject to deposit into a special 113 allocation fund without the consent of such taxing district. 114 4. Beginning January 1, 1998, for redevelopment plans and projects adopted or 115 redevelopment projects approved by ordinance and which have complied with subsections 4 116 to 12 of this section, in addition to the payments in lieu of taxes and economic activity taxes 117 described in subsections 1, 2 and 3 of this section, up to fifty percent of the new state 118 revenues, as defined in subsection 8 of this section, estimated for the businesses within the 119 project area and identified by the municipality in the application required by subsection 10 of 120 this section, over and above the amount of such taxes reported by businesses within the 121 project area as identified by the municipality in their application prior to the approval of the 122 redevelopment project by ordinance, while tax increment financing remains in effect, may be 123 available for appropriation by the general assembly as provided in subsection 10 of this 124 section to the department of economic development supplemental tax increment financing 125 fund, from the general revenue fund, for distribution to the treasurer or other designated 126 financial officer of the municipality with approved plans or projects. HB 1777 5
127 5. The treasurer or other designated financial officer of the municipality with 128 approved plans or projects shall deposit such funds in a separate segregated account within 129 the special allocation fund established pursuant to section 99.805. 130 6. No transfer from the general revenue fund to the Missouri supplemental tax 131 increment financing fund shall be made unless an appropriation is made from the general 132 revenue fund for that purpose. No municipality shall commit any state revenues prior to an 133 appropriation being made for that project. For all redevelopment plans or projects adopted or 134 approved after December 23, 1997, appropriations from the new state revenues shall not be 135 distributed from the Missouri supplemental tax increment financing fund into the special 136 allocation fund unless the municipality's redevelopment plan ensures that one hundred 137 percent of payments in lieu of taxes and fifty percent of economic activity taxes generated by 138 the project shall be used for eligible redevelopment project costs while tax increment 139 financing remains in effect. This account shall be separate from the account into which 140 payments in lieu of taxes are deposited, and separate from the account into which economic 141 activity taxes are deposited. 142 7. In order for the redevelopment plan or project to be eligible to receive the revenue 143 described in subsection 4 of this section, the municipality shall comply with the requirements 144 of subsection 10 of this section prior to the time the project or plan is adopted or approved by 145 ordinance. The director of the department of economic development and the commissioner of 146 the office of administration may waive the requirement that the municipality's application be 147 submitted prior to the redevelopment plan's or project's adoption or the redevelopment plan's 148 or project's approval by ordinance. 149 8. For purposes of this section, "new state revenues" means: 150 (1) The incremental increase in the general revenue portion of state sales tax revenues 151 received pursuant to section 144.020, excluding sales taxes that are constitutionally dedicated, 152 taxes deposited to the school district trust fund in accordance with section 144.701, sales and 153 use taxes on motor vehicles, trailers, boats and outboard motors and future sales taxes 154 earmarked by law. In no event shall the incremental increase include any amounts 155 attributable to retail sales unless the municipality or authority has proven to the Missouri 156 development finance board and the department of economic development and such entities 157 have made a finding that the sales tax increment attributable to retail sales is from new 158 sources which did not exist in the state during the baseline year. The incremental increase in 159 the general revenue portion of state sales tax revenues for an existing or relocated facility 160 shall be the amount that current state sales tax revenue exceeds the state sales tax revenue in 161 the base year as stated in the redevelopment plan as provided in subsection 10 of this section; 162 or HB 1777 6
163 (2) The state income tax withheld on behalf of new employees by the employer 164 pursuant to section 143.221 at the business located within the project as identified by the 165 municipality. The state income tax withholding allowed by this section shall be the 166 municipality's estimate of the amount of state income tax withheld by the employer within the 167 redevelopment area for new employees who fill new jobs directly created by the tax 168 increment financing project. 169 9. Subsection 4 of this section shall apply only to the following: 170 (1) Blighted areas located in enterprise zones, pursuant to sections 135.200 to 171 135.256, blighted areas located in federal empowerment zones, or to blighted areas located in 172 central business districts or urban core areas of cities which districts or urban core areas at the 173 time of approval of the project by ordinance, provided that the enterprise zones, federal 174 empowerment zones or blighted areas contained one or more buildings at least fifty years old; 175 and 176 (a) Suffered from generally declining population or property taxes over the twenty- 177 year period immediately preceding the area's designation as a project area by ordinance; or 178 (b) Was a historic hotel located in a county of the first classification without a charter 179 form of government with a population according to the most recent federal decennial census 180 in excess of one hundred fifty thousand and containing a portion of a city with a population 181 according to the most recent federal decennial census in excess of three hundred fifty 182 thousand; 183 (2) Blighted areas consisting solely of the site of a former automobile manufacturing 184 plant located in any county with a charter form of government and with more than nine 185 hundred fifty thousand inhabitants. For the purposes of this section, "former automobile 186 manufacturing plant" means a redevelopment area containing a minimum of one hundred 187 acres, and such redevelopment area was previously used primarily for the manufacture of 188 automobiles but ceased such manufacturing after the 2007 calendar year; or 189 (3) Blighted areas consisting solely of the site of a former insurance company 190 national service center containing a minimum of one hundred acres located in any county 191 with a charter form of government and with more than nine hundred fifty thousand 192 inhabitants. 193 10. The initial appropriation of up to fifty percent of the new state revenues 194 authorized pursuant to subsection 4 of this section shall not be made to or distributed by the 195 department of economic development to a municipality until all of the following conditions 196 have been satisfied: 197 (1) The director of the department of economic development or his or her designee 198 and the commissioner of the office of administration or his or her designee have approved a 199 tax increment financing application made by the municipality for the appropriation of the new HB 1777 7
200 state revenues. The municipality shall include in the application the following items in 201 addition to the items in section 99.810: 202 (a) The tax increment financing district or redevelopment area, including the 203 businesses identified within the redevelopment area; 204 (b) The base year of state s