Two New Enterprise Zones Win State Approval

Barbara BremerEDSPC News

July 19, 2011

By Matthew Steingraber

The Missouri Department of Economic Development has approved two new Enhanced Enterprise Zones in northern and southern Pettis County, including areas in south Sedalia that were struck by the May tornado.

The newly designated zones include a northern one covering Houstonia and surrounding areas – including
portions of the townships of Blackwater, Bowling Green, Cedar, Heath Creek, Hughesville and Longwood – and a
southern one including Green Ridge and portions of the townships of Elk Fork, Flat Creek, Lake Creek, Prairie, Washington and Smithton, as well as areas in south Sedalia affected by the May 25 tornado.

The initial proposal for the southern zone was expanded last month to include tornado-damaged areas in an effort to encourage damaged businesses to rebuild rather than relocate. Although areas must meet certain poverty, unemployment and other general distress criteria to qualify for designation, the disaster declaration replaced the poverty requirement for the new southern zone.

“We’re extremely excited and thankful they went through as quickly as they did, especially with our existing companies having to rebuild after the tornado,” said Linda Christle, executive director of Economic Development Sedalia-Pettis County.

The zones, which allow companies to apply for tax abatements on new and existing buildings, are meant to
encourage growth of existing businesses while attracting new firms to the area.

In order to qualify for the incentives, businesses are required to create at least two jobs and commit to at
least a $100,000 local investment.

Christle said with the designation of the new zones, businesses damaged in the tornado will be able to start
rebuilding once their applications are approved.

Igor Sheremet, owner of Phillips Automotive at 4207 S. Limit Ave., said he is applying for the Enhanced Enterprise Zone incentives to help in the rebuilding efforts for his business that sustained major damage in
the tornado. Between damage to the building and equipment, he estimated it would cost about $350,000 to fully recover from the storm.

While Sheremet never considered relocating, he said the incentives available through the zone designation would allow him to invest more and possibly expand his business while he rebuilds. “I have a really good location, so I just considered rebuilding and improving and maybe expanding here,”

Sheremet said of his vehicle repair business. “When they give you the tax break, it really helps to invest more money and improve the business.”

Christle said she was working with about nine companies that were damaged in the tornado to apply for the program.

It’s not only businesses affected by the natural disaster that have shown interest in the expanded zones, according to Christle, who said other companies have also contacted the organization about expanding or moving into the areas included in the new zones.

“For some properties that have been on the market, we can now tout the Enhanced Enterprise Zone designation,” Christle said. “It makes us more competitive because now we will have more areas to focus on.”

Since the county’s first, central Enhanced Enterprise Zone was established in 2006, the 23 companies that received the incentive have created 694 jobs and invested more than $100 million in Pettis County.

“It’s proven itself in being very successful,” Christle said.