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Missouri House passes omnibus ag bill with tax credit extensions

JEFFERSON CITY, Mo. — Less than a month into session, the Missouri House passed an omnibus agriculture package that includes several million dollars in tax credits

HB 1720, sponsored by Rep. Brad Pollitt, includes 10 economic agricultural programs affecting wood energy production, meat processing, biodiesel and ethanol distribution, and other programs for Missouri farmers. 

Pollitt said the bill included many “priorities” for the Joint Committee on Agriculture as well as Missouri’s agriculture groups for the year. He said the bill includes between $10-40 million in tax credits and none are transferable. 

“I think it’s got a little bit in there for everybody,” Pollitt told the Missouri Times. “Normally, I’m not a big tax credit person, but at the same time when agriculture tax credits bring back 2-1 at the very least for every dollar the state invests, I think that’s a good investment.”

The legislation seeks to extend Missouri Agriculture and Small Business Development Authority (MASBDA) tax credits that expired Dec. 31. Under this bill, those credits would sunset at the end of 2028.

MASBDA offers grants, loans, loan guarantees, and tax credits to farmers for marketing, processing, or developing new or expanded uses of agricultural products.

According to Pollitt, MASBDA has produced more than $260 million in benefits since 2000. 

The bill maintains the state’s soybean producers assessment is equal to .5 percent of the net market price of soybeans grown in the state if the federal assessment is ever reduced or eliminated. Now, the federal assessment is .5 percent of the net market price of soybeans grown in Missouri with the state assessment one-half of the national assessment. 

Included in the legislation is a provision that doubled the gross sales required to qualify for the Family Farm Livestock Loan Program to $500,000. It also doubled the maximum amount of the loan for each type of livestock and removed the restriction of just one loan per family. 

The bill also: 

  • Extends the Wood Energy Tax Credit until June 30, 2028
  • Extends the Meat Processing Facility Investment Tax Credit until Dec. 31, 2028, and limits the credit to Missouri-based meat processing facilities that employ less than 500 people total
  • Extends the Agricultural Product Utilization Contributor Tax Credit to Dec. 31, 2028
  • Extends the New Generation Cooperative Incentive Tax Credit to Dec. 31, 2028
  • Authorizes certain incentive programs for biodiesel and ethanol retailers, capped at $20 million and $4 million, respectively
  • Moves oversight of anhydrous ammonia standards from the Department of Agriculture to the Air Conservation Commission

Several of Missouri’s biggest agriculture groups — including the Missouri Farm Bureau, Missouri Soybean Association, Missouri Cattlemen’s Association, Missouri Forest Products Association, and Missouri Pork Association — are supporting this bill. 

Along with economic programs, eminent domain is expected to be a big issue again this session. However, Pollitt’s bill does not have any provision related to eminent domain as it left the House.  

Some Republicans indicated discomfort with the tax credits in the bill during floor debate this week. 

“I’d kind of like to know how many of you are going to benefit from this in some economic way,” Rep. Bill Kidd, a Republican from Jackson County, said. (Kidd voted against the bill.)

HB 1720 passed out of the House 120-30 with an emergency clause attached, meaning the legislation would immediately go into effect upon the governor’s signature. The bill now heads to the Senate. 

“This was a bipartisan bill, we got great support from both sides of the aisle, and I think they’ve got that bipartisan support in the Senate,” Pollitt said. 

All of the 30 votes against the bill came from Republicans, including Speaker Rob Vescovo and Budget Chair Cody Smith. 

During the interim, lawmakers and agriculture groups prioritized creating and renewing agricultural tax credits and other programs. The Joint Committee on Agriculture released a report in December outlining the need for an economic stimulant due to the effects of COVID-19 on the industry.