STRICTLY BUSINESS: NEW LAWS, SB1 TO AID STATE'S ECONOMY

Two days before Christmas, a sweeping economic development bill will go into effect -- Senate Bill 1.

Most laws, says Joseph L. Driskill, director of Department of Economic Development, go into effect quietly, without the general public knowing, or caring.

SB1 will probably be no exception, said Driskill, who said the bill just may be one of the most substantial pieces of legislation during his tenure as director of the DED, for two big reasons;

-- It is the only time in recent memory the General Assembly has gone into special session to deal, almost exclusively, with economic development issues. SB1 passed in September by a wide margin.

-- It is a vote of confidence for past efforts and gives the DED the arsenal it needs to bolster economic development.

"We've been working with a set of outdated tools that were designed for a different day and time," said Driskill.

SB1, said Driskell, directly addresses these concerns by giving the DED the tools to improve industrial infrastructure, establish a funding source for early-stage, high-growth potential companies, and provides a program to return abandoned industrial property to productively.

'BUILD Missouri'

Perhaps the most important part of the bill is the extension of the "BUILD Missouri," program. Essentially, BUILD, an acronym for "Business Use Incentives for Large Scale Development, supplies an important funding mechanism to update the infrastructure acquired for high investment, large job creation projects.

Through BUILD, projects of at least $15 million that will create at least 100 new jobs, or office industries with $10 million in investments, creating 500 jobs, obtain funds through the issuance of revenue bonds to finance a project.

Since its inception just over year ago, -- August 1996 -- BUILD has helped create more than 3,000 jobs and supported hundreds of millions of dollars in new investment.

Such programs are already in place in competitor states -- such as Indiana and Kentucky. Now Missouri will have the ability to compete for large-scale projects.

SB1 will also help bolster development in rural areas with limited resources and the urban core of our metro areas through changes in the Tax Increment Financing law.

A part of the bill calls for a "Super TIF." This allows companies that receive local tax abatements to also receive certain state tax abatements. This portion of the bill is considered as one of the most important components of SB1. For the first time, the state will have "tiger" control over the use of TIF and can allow the use of state funds to develop blighted areas.

Missouri is holding its own in economic development. Last year, the state outperformed the national average in all key economic indicators, with more than 200 companies either expanding or moving into the state.

Big projects happening

BUILD has helped make some big projects happen for Missouri, including two big Southeast Missouri projects:

-- Procter & Gamble, Cape Girardeau County, 350 jobs.

-- Caterpillar Inc., West Plains, 100 jobs.

Procter & Gamble Co. Inc. announced in April it will build a $350 million addition to its Cape Girardeau County plant to enable an increase in production of tissues and towels.

The expansion is among the top-three industrial projects in Missouri over the past decade, and will result in 350 more jobs.

With 1,200 workers, the P&G plant north of Cape Girardeau near Trail of Tears State Park already is the largest employer in Southeast Missouri. The addition will be adjacent to the plant and will put about 20 additional acres under roof, which translates into more than 850,000 square feet. Target date for operation is in early 2000.

It will be the largest industrial project in Missouri since 1993, when Ford Motor Co. added to its Hazelwood plant at a cost of $400 million to expand production of its Ford Explorer, said Jim Gardner of the Missouri Department of Economic Development.

"This is the third-largest industrial investment in Missouri during the past decade," said Gardner. "In 1992, Ford added a paint facility to its Kansas City assembly plant at a cost of $375 million."

A month earlier, Caterpillar, a large manufacturer of mining and construction equipment, natural gas engines and industrial gas turbines, announced that West Plains had been selected for a 190,000-square-foot plant for the manufacture of high-pressure hydraulic hoses.

West Plains was a finalist when Caterpillar Inc. selected Dyersburg, Tenn., for a new manufacturing plant in 1995. Construction of the new plant in the Ozark Development Corp. Industrial Park on Highway 63 at West Plains is under way and is expected to be completed next year.

Caterpillar plant under way

It was about two years ago that Caterpillar was looking at sites in Southeast Missouri -- West Plains, Cape Girardeau, Sikeston and Farmington -- and Dyersburg in west Tennessee. Caterpillar selected Dyersburg for a 170,000-square-foot plant that opened in August 1995. The Dyersburg plant is already looking to expand. Caterpillar has announced a 40,000-square-foot expansion that will increase employment.

The plant at West Plains, a community of about 9,000 people, will create about 100 jobs. Caterpillar will be the fifth company to take advantage of "BUILD Missouri," a new program that allows the issuance of bonds to accommodate large-scale projects.

B. Ray Owen is business editor for the Southeast Missourian.