Results from the 2008 Legislative Session

1. Results from the 2008 Legislative Session

2. Passed Omnibus ED Bills (2) Mega Projects - Bombardier Not Passed MEDCode/Voluntary Developer Agreement Law Grow Me State Initiative General Tax Credit Restrictions or Sunsets REDI Donations Tax Credit Missouri Vehicles Tax Credit Rural Empowerment Zones Nearly All Tax Bills, inc. R&D Legislation of Interest to MEDC

3. Not Passed or Defeated MEDCode/Voluntary Developer Agreement Law This was MEDC priority legislation - pulled at our request.  Grow Me State Initiative 3 parts: Angel (Equity) Investment, Seed Capital, Proof of Concept  Legislature seemed generally receptive - more education needed General Tax Credit Restrictions or Sunsets Efforts to restrict or eliminate tax credits in general defeated: • Sunset on all tax credits adopted in Senate but defeated • Proposals to allow budget committees to restrict issuance, certification and approval defeated • Elimination of carryback defeated • Mandatory review and sunset of all TC programs defeated • Reports on tax credit utilization defeated • Wood Energy Tax Credit will sunset in 2013 

4. Not Passed or Defeated REDI Donations Tax Credit Tax credit for donations made to regional ED organizations Missouri Vehicles Tax Credit Tax credit equal to sales tax on motor vehicles manufactured, assembled and purchased in Missouri. Rural Empowerment Zones Would have expanded counties eligible to form REZ Tax Bills Generally, only tax bills without any fiscal impact passed.  R&D on omnibus tax bill that did not pass.  Agricultural exemption for fencing materials passed.

5. Passed Mega Projects - Bombardier (HB2393 - Signed 5/22/08) • Provides starting point for future mega projects legislation • Must be in EEZ • Project must be approved by December 31, 2008 • Capped at $40 m/yr and $240 million total • No tax credits until 2013 • Includes manufacturing and assembly facilities with: • $300m new capital investment over 8 years • 1,000 new jobs over 8 years • Greater than county average wage • Health insurance & 80% of premiums paid • Repayment of incentives • No more than $155 m in tax credits outstanding (tax credits issued less amount repaid)

6. Passed Mega Projects - Bombardier (HB2393 - Signed 5/22/08) • 1 million square foot facility must be constructed within 5 years • If taxpayer fails to deliver, must pay back with a reasonable rate of return to the state • Tax credit is percentage of payroll: • 80% first 3 years • 60% next 2 years • 50% next 2 years • 30% last year  • Taxpayers must make annual reports to DED and House and Senate.

7. Passed Omnibus Economic Development Bills House Bill 2058 - Representative David Pearce Senate Bill 718 - Senator Harry Kennedy  • Cap increases: • Quality Jobs increased by $20m to $60m • EEZ increased by $10m to $24m • DTC stays at $6m (would have reverted to $4m) • MQJ retention credit revived until 2013 • TIF changes: • East West Gateway countywide TIF commission removed but replaced with provision for St. Louis Co., St. Charles Co. and Jefferson Co. that allows county veto authority

8. Passed Omnibus Economic Development Bills House Bill 2058 - Representative David Pearce Senate Bill 718 - Senator Harry Kennedy  • CID may exist in St. Louis special business districts and CID sales tax excludes utilities, phone, cable and video services • DED may issue letter rulings on New Markets Tax Credits • Forfeiture and recapture of TC's if claimant hires aliens • Special property tax provisions for KC airport allow property to be developed without increase in property tax • Codification of an existing exemption for defense contractors • Brownfield remediation includes demolition and changes made to Brownfield program • MQJ Technology project may include some renewable energy production (wind, solar, biomass, geothermal), but not ethanol or biodiesel

9. Passed Omnibus Economic Development Bills House Bill 2058 - Representative David Pearce Senate Bill 718 - Senator Harry Kennedy  • MQJ facilities may include related facilities in same county • Wood Energy Tax Credit sunset in 2013 • New Generation TC  sunset extended from 2010 to 2016 • Allows persons that would otherwise have a conflict of interest to be eligible for tax credits if they own less than 2% of the operation • Every state agency must disclose tax credit recipients and amounts • Public safety local sales tax for Harrisonville and Raytown • Chapter 353 earnings limitations only imposed on urban redevelopment corporations or insurance companies acting as URC

10. Passed Omnibus Economic Development Bills House Bill 2058 - Representative David Pearce Senate Bill 718 - Senator Harry Kennedy  • Requires members of General Assembly and statewide public officials to disclose any tax credits received by them, their spouses or children • Info on tax credits received by such officials is open to the public • Sponsorship and mentoring and cellulose sausage casing tax credits are repealed • Entrepreneurial Development Council established to help protect intellectual property rights of Missouri entrepreneurs - voluntary membership and fund supports members

11. Looking forward to 2009... • Provided Republicans retain majority in House, Speaker-elect Ron Richard will push economic development legislation • New ED Chair in House will be Rep. Tim Flook from Liberty • Focus on tax credits will probably continue in Senate • Budget numbers could slow or thwart incentive legislation QUESTIONS?

12. “Big Mac” McCartyFastest Racing Mouse on the Circuit

13. “Shy Mouse” McCarty