COLUMBIA — At its third meeting on Wednesday, the Enhanced Enterprise Zone Board focused its attention on the local property tax abatement.
The board decided on a maximum property tax abatement of 50 percent, created a subcommittee to draft local accountability measures and voted to seek legal advice on whether local minimum job creation requirements could be higher than the state minimum.
Increasing property values
Pat Lensmeyer, the Boone County collector, recommended that the property tax abatement required for the EEZ program apply only to the increase in property value that is directly related to new investment.
The state requires a minimum of 50 percent local abatement for 10 years on “subsequent improvements” to real property within an EEZ.
The policy recommendation would clarify that any increase in assessed value due to “market-related increases” rather than investment as part of the EEZ program would not be eligible for the abatement.
“The taxing entities would not lose quite as much,” Lensmeyer said.
The board made no formal decision on the policy recommendation.
Minimum state standards
The board discussed whether the state minimum of two jobs being created to qualify for the tax credits could be increased at the local level.
“I don’t see a problem with our standards being a little higher,” board member Anthony Stanton said. “We don’t want to be a C-average city.”
Mike Brooks, president of Regional Economic Development Inc., said that for real property investment, any new local requirements would become the state requirements for the local EEZ, based on his discussions with the Missouri Department of Economic Development. But he said he did not know if the same was true if the company did not seek any local property tax abatement.
Board member Jeremy Root made a motion to seek the legal advice of the Boone County counselor and the city counselor on whether the EEZ program allows for Columbia to impose higher minimum jobs requirements. The board passed the motion unanimously.
Local accountability measures
Stanton expressed concern about enforcement of the minimum standards for companies to receive property tax abatement. He said companies would try to take advantage of the program without maintaining the minimum number of jobs.
“They’re going to play the books the best they can,” Stanton said. “What are we going to do to protect ourselves?”
The board voted to create a subcommittee to draft language to hold companies accountable for job creation requirements. Lensmeyer, Bernie Andrews, the vice president of REDI, and James Whitt, the Columbia Public Schools representative, are on the subcommittee.
- The board voted to recommend the local property tax abatement within the EEZ be no more than the state minimum of 50 percent.
- Stanton volunteered to contact the Office of Social and Economic Data Analysis to invite them to present at the next meeting of the board.
The next meeting has been set from 5 to 7 p.m. July 2. The location has yet to be determined.
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