Enterprise zone designation provides another economic development tool, officials in Cape County say
Sunday, September 25, 2011
Area community leaders are more confident of their efforts to lure companies here now that the Missouri Department of Economic Development has approved an enhanced enterprise zone for most of Cape Girardeau County.
New and expanding businesses in the zone are now eligible for state income tax credits and a 50 percent local property tax abatement for 10 years.
"We're talking to some companies that this could have an impact on their projects," said Mitch Robinson, executive director of Cape Girardeau Area Magnet, who oversaw the zone application process. "It's something people were aware was coming down the pipe."
Robinson declined to comment specifically on any pending projects but said the incentives communities offer frequently determine a project's location.
"Incentives are the tiebreakers often in communities where the labor is similar, transportation and buildings are similar. Sometimes it can come down to which community is more aggressive," Robinson said. "That's very true between states as well as communities."
To qualify for an enhanced enterprise zone, areas must meet certain unemployment rates and poverty level guidelines, so not all of the county is included.
However, the zone, approved last week, does encompass the SEMO Port, Nash Road, the majority of the industrial sites in Cape Girardeau and Jackson as well as the area off Highway 177 where Procter & Gamble and Nordenia are.
In Missouri, 107 of 114 counties already have enhanced enterprise zones. The program began in 2004 and replaced an enterprise zone program that was phased out. Cape Girardeau did have an enterprise zone, but it did not extend out into the county or to Jackson, Robinson said.
"The designation of this enhanced enterprise zone in our area will be an additional tool to aid in our economic development efforts," Jackson Mayor Barbara Lohr said. "We are glad to finally have this designation approved."
Robinson first presented the enhanced enterprise zone application in August 2010, so approval took 13 months, he said.
Companies in the zone eligible for incentives are limited to manufacturing, wholesale trade, transportation and warehousing, information, finance and insurance, professional or scientific, administrative and waste services. Companies that do not qualify for incentives include gambling operations, retail, educational services, religious organizations, public administrators, and food and drinking establishments, according to state law.
"This is very good news for future economic development in our area," Cape Girardeau Mayor Harry Rediger said. "It identifies specific opportunity areas that will qualify for additional incentives for development and job creation."
Companies must create at least two jobs and make a minimum investment of $100,000 for new businesses and $1 million for existing businesses that are expanding. Companies also must pay at least 50 percent of the employees' health insurance costs.
A seven-member board to oversee the enhanced enterprise zone was appointed by the Cape Girardeau County Commission earlier this year.
The Missouri Tax Credit Review Commission, which released a report in February after a series of hearings around the state, recommended the elimination of 28 tax credit programs, including the enhanced enterprise zone. Members said those programs had outlived their usefulness and do not create a justifiable benefit in relation to their cost to taxpayers, according to the report.
A broad bill overhauling Missouri's tax credits and business incentives was the key issue of a special legislative session that began Sept. 6.
The House and Senate each quit Friday without agreeing on the details of an economic development bill.
1267 N. Mount Auburn Road, Cape Girardeau, MO