Missouri DED accepts tax credit reduction recommendations

Joe Driskill, director of the Missouri Department of Economic Development, Jan. 11 released a report from the Ad Hoc Tax Credit Task Force recommending a $7.7 million reduction in costs associated with several of the state's tax credit programs.

According to a DED news release, the recommendations were made in response to a directive given by Gov. Bob Holden to cut $7.5 million from the cost of the 31 tax credit programs administered by the department. The release stated that the tax credit programs are estimated to cost $220 million in the present fiscal year.

Of those 31 programs, 14 are discretionary and therefore are eligible for cost reductions. The remaining programs are non-discretionary; they possess statutory guidelines requiring changes in state law to be enacted before they can be altered.

"We have reviewed the recommendations and the Department of Economic Development will implement them without change," Driskill said.

Recommended tax credit program reductions will affect 11 of the 14 discretionary programs. The reduction amounts and the programs affected include: $500,000 for New Enterprise Creation; $456,000 for Brownfield Remediation; $1 million for New Jobs Training; and $224,000 for Neighborhood Preserva-tion.

Two programs' funding will be completely eliminated this fiscal year, as no applications were received for them. Those programs are Brownfield Demo-lition and the New Generation Co-op program, which together account for a $750,000 reduction.

"The governor challenged us to make changes in several of the department's tax credit programs that will result in substantial cost-savings for the state," Driskill said. "This is a very serious issue that drew a lot of interest from across the state so we were very deliberative in our process," he added.