What Are Chapter 100 Bonds?
Chapter 100 is a tool Missouri cities can use to encourage businesses to invest in their communities.
In simple terms, Chapter 100 allows a city to provide certain tax breaks to a company in exchange for an investment in the community.
Here is how it works:
- The City helps arrange the agreement. The City acts as a middleman for the financing and paperwork. The City merely acts as a conduit for the financing.
- The bonds are tied to the project. They are not the same as ordinary City debt paid back with taxpayer money.
- The company receives a tax break. Depending on the agreement, this may apply to real estate taxes, personal property taxes, or sales taxes.
- The company makes agreed-upon payments. These are called Payments in Lieu of Taxes (PILOTS). They are payments made instead of the regular taxes that would otherwise be owed.
- Payments are distributed to taxing jurisdictions. PILOT payments are collected by the Warren County Collector, similar to personal property taxes.
The purpose is to attract major investments while providing financial benefits to the local community.
How Does the Warrenton–Crusoe Agreement Work?
1. What taxes are affected?
- Personal property taxes: Crusoe receives a tax abatement under the agreement and makes PILOT payments instead.
- Real estate taxes: Crusoe will continue paying 100% of real estate taxes.
- Fire and ambulance services: These services will receive 100% of the personal property taxes that would otherwise be due to them, rather than the reduced 25% PILOT payment provided to other affected taxing jurisdictions.
2. How long does the agreement last?
- The agreement provides for up to 15 years of tax abatement, with a possible five-year extension.
- The abatement begins January 1 following the acquisition of the first portion of equipment.
- The agreement has a maximum principal amount of $85 billion.
3. What must Crusoe do to qualify?
- The project must include one of the five specified major technology companies: Microsoft,Oracle, Meta, Google, or Amazon.
- The agreement requires 35 permanent, full-time jobs in the first phase and 35 in the second phase.
- Qualifying jobs must average at least 35 hours per week, include health insurance with the company paying at least 50% of the premiums, and provide average total annual wages of at least $100,000.
- If Crusoe fails to meet the job requirements, additional PILOT payments may be required.
4. What Happens if Tax Levies Are Rolled Back?
- The PILOT payments are based on the applicable tax rates and the terms of the agreement. If tax levies are rolled back or reduced, the PILOT amounts may also decrease. This means the payments received by the affected taxing jurisdictions could be lower as well.
Additional Community Benefit Payments
In addition to PILOT payments, the agreement requires Crusoe to make the following payments to support local services and the community.
| Recipient | Required Payments |
| City of Warrenton | $2 million within 30 days after the bonds are issued, plus another $2 million at the earlier of the bond’s first anniversary or December 31 of the year the first equipment is conveyed to the City. |
| Warren County Emergency Services | $5 million 12 months after state approval for the sales tax exemption program; another $5 million after 24 months; and $20 million paid in annual installments over the following 13 years. |
| Warren County Sheriff’s Department | $3 million annually for 15 years, beginning 12 months after approval. |
| Fire District | $250,000 within 30 days after the bonds are issued. |
| School District | $100,000 within 30 days after the bonds are issued. |
What Does This Mean for Warrenton Residents?
The Chapter 100 agreement is designed to encourage a major business investment in Warrenton while providing payments and other benefits to local taxing jurisdictions and public services.
The key takeaway: The City facilitates the agreement, Crusoe receives a personal property tax abatement under the agreed terms, and Crusoe must make specified PILOT and community benefit payments. Crusoe will also continue paying 100% of its real estate taxes.