Southern States Cooperative, Inc: Alternative Minimum Calculation (AMC)
Objective
Seek repeal of the Alternative Minimum Calculation (AMC) tax that was applied to Southern States Cooperative (SSCOOP) as a result of the tax reform legislation adopted in 2005
Strategy
Scheduled meetings between key SSCOOP personnel and legislative leaders as well as the state budget director and the Governor’s Chief of Staff to illustrate the unintended consequences on SSCOOP which is a farmer/member owned agricultural cooperative. Those unintended consequences resulted in SSCOOP paying the state approximately $250,000 per year for their AMC tax liability.
We also stressed that it was never the legislatures intend to be the only state in the nation to tax farmer owned cooperatives which made Kentucky both a state unfriendly to these types of businesses and essentially eliminated any prospect for future investment. It also reduced the patronage dividend to the farmer member which owns the cooperative by the amount of the annual tax liability.
Sought support and buy-in from key members on the Appropriations & Revenue Committee and other legislative leaders friendly to agriculture.
Results
An AMC technical corrections bill was passed in special session in the summer of 2006 that totally eliminated the tax for SSCOOP which saved the cooperative at least $250,000 or more each year forever!