Growing up, I remember my mom working at our local clothing factory in the late 1980s making smocks and aprons. The farm economy was especially tough, and since my brother, sister and I were all in school, it was a good opportunity. Back then, it was pretty common to have factories in small towns.
Our rural communities have seen considerable change since then and, frankly, the need for investment is great. A little-known commission within the Missouri Department of Agriculture is making a big impact across our state.
The Missouri Agricultural and Small Business Development Authority, or MASBDA, issues targeted tax credits and grants for investments in specific types of businesses. Since 2000, MASBDA estimates its tax credit programs have generated $247 million in direct and indirect benefits to our state. Several of the most valuable credits are set to expire this year and need to be extended.
Some of the most valuable of MASBDA’s tax credits are the New Generation Cooperative Incentive, the Agricultural Product Utilization Contributor Program and the Meat Processing Facility Investment Program. These credits support local jobs by spurring investment in value-added processing facilities. This helps keep more of the benefits of Missouri agriculture in our local communities.
The largest of these programs is the New Generation Cooperative Incentive. This tax credit helps draw in private investment for value-added processing. To date, $63 million in tax incentives have generated over $501 million in private investment. MASBDA has issued credits to projects in at least 103 counties throughout Missouri, reaching every corner of the state.
MASBDA’s programs have helped rural Missouri in many ways, like getting ethanol plants off the ground, helping small butchers and meat processors and expanding farmer cooperatives. At a time when consumers are looking more and more to buy local, especially when it comes to their food, farmers and small businesses can use these tools to serve their communities.
Of course, tax credit programs should be carefully watched to ensure they are accomplishing their goals and not being abused. Placing a sunset date on the program ensures it will receive a thorough review after a few years. If elected officials find that a tax credit is doing its job and adding value to our communities, they can vote to extend the sunset.
Five of these rural-focused tax credit programs are scheduled to expire on Dec. 31, including those listed above. Fortunately, some leaders in the state legislature are working to renew them. State Sen. Denny Hoskins (R-Warrensburg), State Rep. Rick Francis (R-Perryville) and Rep. Greg Sharpe (R-Ewing) have introduced legislation to extend these tax credits an additional six years, through the end of 2027.
Missouri has found a proven and effective way to leverage state investments in agriculture and small business. The legislature should complete the job of extending MASBDA’s programs so they can continue helping our rural economy grow.