Jackson, Perryville officials discuss economic development at seminar

Bankers and business leaders took a look at the tools inside what Magnet executive director Mitch Robinson called the economic development toolbox during two seminars Thursday.

The sessions included presentations by state and local economic development officials on several incentive programs available to new and expanding businesses.

About 20 people, including representatives of the cities of Jackson and Perryville, Mo., took part in an afternoon session at the Jackson Area Chamber of Commerce. An evening session also was held at the Cape Girardeau Area Chamber of Commerce.

David Meyer of the Missouri Department of Economic Development spoke about state incentive programs available to expanding businesses.

"We've been growing and we want to continue to grow our industries and know all the tools that might be available to us," said Perryville Mayor Debbie Gahan, who attended the afternoon session in Jackson.

With the different types of state programs out there, Gahan said it can be puzzling for communities to determine which best fits their needs and the needs of the companies looking to come there.

Property tax abatements, sales tax exemptions, infrastructure funding, utility rate reductions, building leases, cash grants and even moving subsidies for executives have all been used by Missouri communities to attract business and create jobs, Meyer said.

"Most of the job growth in the state of Missouri is from existing businesses," Meyer said.

Another growing source of jobs is entrepreneurs who are starting small businesses employing themselves, and creating jobs for others.

Missouri is an attractive state to conduct business in, Meyer said. It has the 14th lowest overall state and local tax rate in the U.S. along with a low cost of living and low energy costs, compared to other states, he said.

Carol Shoemaker of the Missouri Department of Economic Development shared details about the Enhanced Enterprise Zone program, which offers tax credits to businesses in designated areas that meet certain unemployment rates and poverty level guidelines. In September, an Enhanced Enterprise Zone was approved for portions of Cape Girardeau County. In this area, 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.

Drew Christian of the Southeast Missouri Regional Planning and Economic Development Commission spoke about his organization's Revolving Loan Fund, available to help finance local business expansions.

Currently, the fund has 25 businesses with loans totaling $1.9 million outstanding. The fund has about $160,000 available to lend for new projects at this time. The most recent company to use the fund was Blair Best Box, which started operations in the former Thorngate LTD building in Cape Girardeau earlier this year. The company received a $165,000 low-interest loan from the fund.

The Commission's Revolving Loan Funds come from the U.S. Economic Development Administration, Christian said.

A new funding agency for small and startup businesses opened in Cape Girardeau about two months ago is ACCION Delta. Craig Bohnsack, loan officer with ACCION Delta, discussed how the not-for-profit organization based in Texas is able to help businesses that don't qualify for traditional bank financing because of a lack of collateral or a less than stellar credit rating. ACCION's loan terms range from six months to 12 years, with interest rates from 10.5 to 18 percent. The company, which offers loans from $500 to $50,000, also does not charge an early repayment penalty.

Robinson also spoke during the session about Chapter 100 bonds, which are used for large economic development projects. The most recent company to use that incentive was Nordenia, which is constructing a new warehouse in Jackson and investing more than $20 million in facilities and equipment over the next three to four years.

Chapter 100 bonds are a form of tax abatement amounting to 50 percent of both real estate and personal property taxes in Cape Girardeau County.

"This is the sledgehammer of economic development tools," Robinson said. "It's the biggest tool we can bring. We've done six in Cape Girardeau County." Three of those were for expansions at Procter & Gamble.

mmiller@semissourian.com

388-3646

Pertinent address:

125 E. Main Street, Jackson, Mo.