Local taxing districts voiced confusion about payments under the Chapter 100 agreement with American Foods Group’s America’s Heartland Packing facility in Warren County during the Warren County Commission meeting Dec. 11.

Representatives from the Wright City R-II School District, Warren County Ambulance District and Wright City Fire Protection District were present to discuss the matter with the commissioners and Gilmore & Bell representatives.

Gilmore & Bell attorney Mark Grimm said that when his firm did the projections for the Chapter 100 agreement between the county and AFG they projected a value of $220 million in real property and a personal property valuation of $428 million. He said that while the real property valuation is right on target, the personal property valuation is off for 2025 due to what he described as a timing issue. Grimm said AFG transferred $90 million in assets to the county earlier this year. He said the company had some delays in the acquisition of equipment late last year and is working to get all of the assets to the county so that the numbers should be closer to estimates by next year.

AFG’s tax abatement agreement covers an 80 percent abatement on personal and real property taxes for 2025 and the following three years, with the abatement reducing to 75 percent for the remaining 16 years of the agreement. AFG will be making what are known as payments in lieu of taxes (PILOT) for 20 percent for 2025, 2026, 2027 and 2028, with the amount being 25 percent for the remaining 16 years. However both the ambulance and fire districts opted out of the PILOT payments and therefore will be receiving 100 percent of the real and personal property taxes due and owing based upon their respective tax rates.

One of the main points of confusion though was in the PILOT payments themselves. Wright City R-II Finance Director Veronica Klaus and Darren Lenk with the ambulance district asked why the PILOT payments were not separate payments. At one point during the meeting Lenk said he felt that the taxing districts did not receive correct information about how the PILOT payments would work.

Gilmore & Bell attorney Jason Terry asked whether they thought the PILOT payments would be in addition to payments they would receive with their normal tax collections and Klaus said she thought it would be handled that way. Terry explained that the PILOT is not 20 percent on top of other taxes, but would be 20 percent of the 100 percent billed to AFG in a given tax year. It was also explained that the ambulance district opted out of receiving PILOT payments and therefore was receiving 100 percent of its taxes.

This then led to concerns regarding Missouri’s Hancock Amendment, which designed to reign in tax increases.

If a taxing entity’s tax revenue increases by more than five percent of the Consumer Price Index rate of inflation in a given year, whichever is lower, the entity must lower their tax rate to match the increase.

During the meeting it was discussed that since real property improvements are considered new construction, they are exempt from the Hancock Amendment. During the meeting the Warren County Assessor’s Office noted that the real property improvements for 2025 amounted to about $175 million, with another $25 million or so in valuation to be added to the rolls for the 2026 tax year.

Klaus said one of her concerns is that this year the district was “Hancocked” and had to roll back their tax rate.

Grimm said his firm could look into the effects of the Hancock Amendment regarding the issue. Presiding Commissioner Joe Gildehaus asked the two representatives from Gilmore & Bell whether they could come up with a spreadsheet that would show each taxing district what the amounts would be going forward. Grimm said they could update the cost-benefit analysis to better outline those figures.