SB 1036 - This act modifies the Missouri Works program by modifying several definitions. The definition of "average wage" is modified by dividing aggregate new payroll by the aggregate actual hours worked for new jobs multiplied by 2,080. A definition is added for "gross wages" and "taxable wages". The definition of "new payroll" is modified to include amounts paid by a qualified company for health insurance premiums if such qualified company pays 100% of the health insurance premiums of its full-time employees. The definition of "notice of intent" is modified to require such notice to be accompanied by an affidavit attesting to the estimated number of new jobs, position types, and new payroll. Multiple definitions are modified to change "payroll" and "wages" to "gross payroll" and "gross wages". (Section 620.2005) In the event that the average wage for all new jobs created fails to meet the average wage requirement, this act allows a qualified company to retain withholding tax for the minimum number of required jobs. The Department may choose which new jobs to include in the minimum number to be averaged that will meet or exceed the average wage requirement. Current law bases the amount of tax credits to be authorized for a qualified company on a percentage of new payroll. This act changes the base for such tax credits to a percentage of new taxable wages. Current law requires the Department of Economic Development to consider certain factors when determining the amount of tax credits to award to a qualified company. This act requires the Department to also consider whether the qualified company participates in a pre-apprenticeship program approved by the Missouri Department of Higher Education and Workforce Development and the location of the headquarters of any contractor used by the qualified company, with preference given to contractors that are selected through an open bidding process that are headquartered in Missouri and for whom at least 85% of the workforce used for any work performed by the contractor for a qualified company reside within fifty miles of the site of such work. (Section 620.2010) This act is identical to SB 32 (2025), HB 1319 (2025), SB 785 (2024), and HB 2894 (2024). JOSH NORBERG

2026 Regular Session

Missouri Works program shifts tax credit calculations to "taxable wages," allows selective job-counting for wage requirements, and prioritizes local contractors and apprenticeships.

Second Read and Referred S Government Efficiency Committee

Legislative bill overview

SB 1036 modifies Missouri's Works program—a tax credit incentive for business job creation—by redefining how wages are calculated and taxed, allowing flexibility when average wages fall short, and adding preferences for companies using local contractors and apprenticeship programs. The bill shifts tax credit calculations from new payroll to "new taxable wages" and gives the Department of Economic Development discretion to select which jobs count toward wage-requirement averages.

Why is this important

The Missouri Works program uses public tax dollars to incentivize private business expansion. These modifications affect how much tax relief companies receive and what threshold they must meet, directly impacting state tax revenue and the types of jobs/businesses the state prioritizes. The shift toward "taxable wages" (typically excluding benefits) could reduce stated job quality while appearing to meet requirements, and the discretionary job-selection provision gives government significant power to determine program outcomes.

Potential points of contention

Wage accounting ambiguity: Excluding health insurance premiums from wage calculations and shifting to "taxable wages" may lower reported average wages while claiming the same benefits, potentially obscuring actual job quality subsidized by taxpayers.

Administrative discretion: Allowing the Department to cherry-pick which jobs count toward the minimum wage requirement reduces transparency and creates potential for inconsistent or favored treatment of companies.

Local contractor preference burden: Requiring 85% of contractor workforce within 50 miles could increase costs for companies or favor certain regions, potentially limiting competition or driving up project expenses passed to consumers.