The Senate Ways and Means Committee approved Thursday, Jan. 23, a measure to phase in a major reduction in the state's income tax, eventually dropping the top rate from six percent to five percent of taxable income.
The committee vote, 7-2 with one voting present, came after a brief committee discussion and no debate.
The reductions would not take effect until 2015 and would take at least ten years to take full effect. No reduction would occur in any year unless there had been at least a $100 million increase in tax collections in one of the prior three years.
The bill includes a similar phased-in exemption of business income from the income tax, ultimately exempting one half of business income from the personal income tax.
The measure also would provide an extra $1,000 personal income tax deduction for persons with taxable incomes below $20,000.
Legislative staff estimate that when fully implemented, the bill would cost the state more than $900 million in state revenue.
The committee's vote came just two days after Republican legislative efforts to cut taxes had been attacked by Gov. Jay Nixon in his State of the State address.
Nixon had vetoed a similar measure last year. An override effort failed in the House where 15 GOP legislators, mostly rural, voted to sustain the veto.
Some said they were concerned about the impact of the tax cuts on funding for local public schools.
Nixon issue a statement within hours repeating his warning that the tax cuts would hurt education.
"The General Assembly can get serious about fully funding our schools, or they can undertake fiscally irresponsible experiments wit our tax code -- the cannot do both," Nixon was quoted in a release as saying.
But Krause argued that because the measure would not implement tax cuts without increases in tax collections, it would not cut budgets.
"We're not taking anything out of core budgets," Krause said. "We're doing this out of the growth of government...as government grows and revenue increases, we taking some of that and returning it to the taxpayers."
The Senate bill now goes to the full Senate.
Five St. Louis area senators brought up identical proposals Wednesday to change student transfer laws.
Sen. Eric Schmitt, R-St. Louis County, Gina Walsch, D-St. Louis County, Scott Rupp, R-St. Charles County, John Lamping, R-St. Louis County, and Scott Sifton, D-St. Louis County, introduced the bills in front of a packed Senate Education Committee hearing.
Schmitt highlighted a few points of the proposal. For one, it allows for the individual assessment of schools. This meaning that within an unaccredited district, each individual school could be evaluated as accredited or unaccredited.
The proposal also allows the receiving school districts the establish criteria as to how much space they have available in their schools for transfers.
It also makes a longer school day or year a possibility for some at-risk, unaccredited schools.
Schmitt says longer school days and years have improved conditions at other schools in at-risk communities across the county.
Sen. Maria Chappelle-Nadal, D-St. Louis County, a former transfer student who says she is extremely passionate about the issue, questioned if districts like Normandy who already face going bankrupt soon, could afford longer days.
"When you're at zero, you're at zero, there's nothing left in the bank, senator. How many checks are we writing out that's leaving a Normandy school distrcit or Riverview Gardens school district?" Nadal asked.
Chappelle-Nadal along with a few others have also introduced student transfer law bills this session.
The bill's sponsors say it is a long road ahead in formulating a bill that can potentially pass through the legislature and nab the Governor's signature.
Walsh admits even the five sponsors don't agree on everything inside the twin bills.
“This bill has a lot of things in it. We don't all agree with all of it, and this is why it's a beginning," Walsh said.
The 41st anniversay of Roe v. Wade finds Missouri legislators proposing abortion bills that would delay the procedure and notify minors' parents ahead of time.
Currently, a Missouri woman can receive an abortion 24 hours after her first consultation. Two proposed bills would extend the mandatory waiting period to 72 hours.
Minors in Missouri can also receive abortions without clinics notifying the children's parents ahead of time. But one bill aims to require that parents be notified of abortions before the procedure is performed on their child.
Health Care Policy Chairman Rep. Keith Frederick, R-Rolla, said these bills enable women to consider all their options.
"This does not make it illegal, it doesn't restrict access," Frederick said. "It simply says we want additional time to be reflective of all of the information and all of the decision process."
Missouri ACLU Executive Director Jeffrey Mittman said the bills have nothing to do with giving women time.
"This law mandates a uniform standard that has nothing to do with a woman's decision-making process or the decision-making process of a doctor," Mittman said. "Forcing a woman who needs a procedure to delay her abortion without medical reason is dangerous and cruel."
Missouri is one of 30 states with a 24-hour delay between first meetings and appointments. Should the bills pass, Missouri would become the third state to mandate a 72-hour waiting period.
The House Special Standing Committee on Small Business heard a bill Wednesday that would require all stores and shops selling retail items to close on Thanksgiving, Christmas and Easter Sunday.
The Missouri Chamber of Commerce said they do not approve of the bill.
"According to members of the Missouri Chamber, retailers do not have any problem finding workers who want to work the holidays, often earning more than average wages," the Missouri Chamber said in released statement.
Rep. Keith English, D-St. Louis County, sponsored the bill and said the hearing was a downhill spiral.
"Today's debate brought up some great ideas and some things that I'll consider, but the competition is a big thing that I didn't really think about," English said.
English said shoppers near state borders could go across the border and buy their items in the neighboring state, which would lead to a loss of tax revenue for Missouri.
"The legislation is also an infringement on free enterprise, eliminating an opportunity to add to our state's economy," the Chamber said in a statement.
English said his main concerns are restoring family values and protecting minimum wage workers forced to work on the holidays.
He said another way to solve his concern is to raise minimum wage across the state, or implement a pay and a half system for the workers during these holidays.
Senate Appropriations Committee Chairman Kurt Schaefer, R-Columbia, chastised Gov. Jay Nixon's budget proposal for 2015 during a meeting on Wednesday. He likened Nixon's Jefferson City budget to a place Republicans love to criticize.
"This is a Washington D.C. budget," Schaefer said.
Nixon's budget relies on a 5.2 percent increase in general revenue in the fiscal year 2015, whereas House and Senate economists agreed on 4.2 percent revenue growth.
Sen. Rob Schaaf, R-St. Joseph, didn't understand how Nixon came up with 5.2 percent revenue growth and said Nixon refused to explain why.
"The governor's office wouldn't give (House and Senate economists) any data," Schaaf said.
Among Nixon's proposals are $1.2 billion for Medicaid expansion, $278 million for the K-12 foundation formula, and $42.1 million for colleges and universities based on their performance.
Schaefer took aim at the governor's budget while questioning Luebbering, calling it "an absolute political fiction," Schaefer said.
Last year, Republicans blocked multiple attempts at Medicaid expansion. That includes a proposal from Rep. Jay Barnes, R-Jefferson City.
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Credit card service companies would be required to create more transparent contracts for small businesses under a proposed bill.
The House Financial Institutions Committee heard the bill Wednesday, and bill sponsor Rep. Bill Lant, R-Pineville, said requiring a certain font size could help business owners be more aware of the deals they enter into.
"I've had several of the small businesses in our area that have come to me complaining that they entered into a contract that they didn't understand and are trying to get out of the contract," Lant said.
Lant said the complaints come from high monthly service and cancellation fees.
The bill co-sponsor Rep. Bill Reiboldt, R-Neosho, said the credit card service companies rent the credit card machines to businesses instead of giving them an option to buy it, which can lead to higher costs for the businesses.
A similar bill was presented last year but did not make it out of committee.
Following the annual State of the State address Tuesday evening, Missouri GOP leadership voiced concerns over increased funding to education and Medicaid expansion outlined in Gov. Jay Nixon's proposed budget.
"I thought there was a bit of rhetoric in parts of his speech, and to a degree maybe a condescending tone," Senate President Pro Tem, Tom Dempsey, R-St. Charles County, said following the address.
Nixon's proposed budget focuses heavily on education funding, primarily higher education and K-12. He proposes allocating an additional $493 million towards education, from preschool to graduate school, in the state.
The budget proposes $278 million increase in funding to the K-12 foundation formula, half of the amount needed for full funding.
For higher education, Nixon's budget adds additional funding to Missouri scholarships such as Access Missouri, Bright Flight and the A-Plus Program. He also said he has called on four-year institutions to freeze tuition rates for undergraduates.
Funding for colleges and universities within the state will be awarded based on performance.
As Nixon announced his education funding proposals GOP members remained seated amid Democrats standing and loud applause.
Following the address, Speaker of the House Tim Jones, R-St. Louis County, said he would prefer Nixon propose legislation to improve the education system rather than "throw more money at the problem."
Nixon also addressed the expansion of Medicaid in the state. He said the most significant improvement that could be made to the wellbeing of the state is Medicaid, and he called on the General Assembly to pass Medicaid expansion this year.
He labeled the implementation of the federal health care act "abysmal," which received loud applause from the GOP side of the chamber. Nixon continued, however, and said rejecting Medicaid would not fix the problems.
A House hearing scheduled to discuss the current execution protocol in Missouri was canceled Tuesday, Jan. 21, after the director of the Department of Corrections, George Lombardi, told the committee chair he would not attend.
There was no explanation from the department which did not returned repeated reporter calls.
House Committee Chairman Jay Barnes said he canceled the hearing, hoping that Lombardi would be able to attend at a later date. Barnes said the issue would not go away. He said the committee would wait until Lombardi was available to testify.
"This committee has never held a one sided hearing and we aren't going to get in that practice if we can avoid it," he said.
The committee hearing was set to address concerns that have been raised over an execution drug being used from a pharmacy not licensed in Missouri.
A couple of days later, the Senate's Democratic Leader, Jolie Justus, told the Senate Thursday, Jan 23, that she would sponsor legislation imposing a moratorium on the death penalty until a commission can adopt procedures for conducting an execution.
Justus attacked the department's decision to keep secret the name of the company manufacturing the chemical used for lethal injections.
"It's time, that whether we agree with the death penalty or not, that we all have a conversation about how we are executing individuals in the state of Missouri," Justus told her colleagues. "We have no idea where these drugs are coming from...we have no idea how we even investigate this protocol because it's under this veil of secrecy."
Justus later said the bill would be prepared for introduction on Monday, Jan. 27 -- just days before Missouri's next scheduled execution for Jan. 29.
A similar measure had been filed earlier in the House.
The debate over the tax cut bill vetoed by Gov. Jay Nixon last year returned Thursday, Jan. 16, to the Senate Ways and Means Committee.
Before the committee were three bills that contained portions of the bill vetoed last year.
The arguments before the committee were the same.
Supporters said tax cuts for income tax payers and businesses would stimulate the economy and put Missouri in a more competitive position with bordering states that have cut taxes, such as Kansas.
"I think whether we like it or not, tax relief and these broad-based tax cuts are the new border war we are facing and Missouri must remain competitive," said Tracy King, a lobbyist for the Missouri Chamber of Commerce.
Opponents, however, argued the tax losses would not be recovered from economic growth and would lead to cuts in education and other government services.
Among the opponents was the former budget director for Republican Gov. John Ashcroft.
Jim Moody, now a lobbyist for a Kansas City organization of business leaders, told the committee that not all of businesses supported the tax cuts.
Moody disputed claims that economic growth had replaced the tax loses for government services from the tax cuts.
"They are not growing. They are contracting," Moody said.
The committee took no immediate action on the proposals. One of the bills would cut the income tax rate for higher incomes, another could cut business income taxes and a third would phase in reductions in both personal income and corporate income tax rates.
Legislative staff estimate the combined package, sponsored by the Ways and Means Committee chair, would lead to nearly $1 billion in reduced taxes when fully implemented.
That would exceed ten percent of Missouri's entire annual tax collections for the General Revenue budget.
However, the bill sponsored by Sen. Will Kraus, R-Jackson County, would not authorize an annual phase-in of a tax cut unless state tax collections had grown by at least $100 million higher than collections in any one of the prior three years.
Secretary of State Jason Kander proposed Tuesday the strictest set of restrictions on special interest money yet filed in Missouri's legislature.
Under Kander's plan, a lobbyist would be prohibited from providing a gift or meal of any value to a legislator, public official or staffer. His bill also would make it a crime to lie to the state Ethics Commission and, like other Democratic proposals, would impose limits on how much any one person could contribute to a political campaign.
"It's time we really get serious about this," Kander said at a news conference in which he noted that similar restrictions have been proposed in the legislature but stalled for years. "All over the state Missourians are wondering whether or not their legislature is going to address this issue."
In December before the legislative session, Gov. Jay Nixon had joined with a Republican and Democratic legislator endorsing a similar package, but one that would allow a lobbyist to make an expenditure of up to $50 for a legislator.
The Senate sponsor, Sen. Will Kraus, R-Jackson County, said he could support a total ban on lobbyist gifts, but that it stood little chance in the legislature. Kraus also said there was practical consideration.
"To think someone is going to be bought off by a lunch is something else you have to look at," Kraus said in reference to the regular Capitol lunches and breakfasts that lobbyists provide during legislative sessions that are available to anyone -- including legislators, staff, fellow lobbyists and visitors to the statehouse.
On the House side, House Majority Leader John Diehl who co-sponsored a similar $50 exemption said he was willing to discuss tougher limits.
Ironically, less than an hour after Kander's news conference, the Missouri Cable Telecomunications Association hosted a buffet luncheon just outside the House and Senate chambers in which legislators and staffers partook.
Wealthy Missourians would pay higher income taxes to offset a cut in taxes for lower and middle-income taxpayers under a plan unveiled by House Democrats Monday.
For Missourians earning more $5,000 up to $30,000 in taxable income, tax rates would be cut to four percent. Currently, taxable incomes above $9,000 are taxed at six percent with graduated lower rates for lower incomes.
For those with taxable incomes above $300,000, the tax rate would be increased from six percent to eight percent. Democrats argued that higher-income tax increase would make the proposal revenue neutral by covering the costs for the tax cuts for those below $30,000.
"Asking the folks at the very top to pay a little more, I think has broad-based support in this state and I think is the right thing to do," said the bill's sponsor, Rep. Jon Carpenter, D-Gladstone.
Last year, Gov. Jay Nixon vetoed a tax-cut measure that would have reduced corporate taxes as well as providing an across-the-board cut in income tax rates.
"The Republican train of thought is that if we cut taxes for the super-rich and the job creators that then it will trickle down. We don't believe that," said House Democratic Leader Jake Hummel, D-St. Louis City. "We think that by raising people's wages and their standard of living, that that actually helps the job creators. It puts more money into the pocket of every-day Missourians and it allows them purchase the products they then make."
But one of the Senate sponsors of the Republican's approach to tax cuts said taxing the higher income could hurt the state's economy.
"Raising taxes on the higher income, those are the job creators. Those are the small business owners," said Sen. Will Kraus, R-Jackson County. "If you raise taxes on them, some of them might decide that the taxes are too high and go over to Kansas where they have no taxable income."
Kraus's bill is scheduled for a hearing before the Senate Ways and Means Committee Thursday.
Under his plan, a cut in the income tax rate would be phased in for everyone making more than $9,000 in taxable income -- eventually dropping the tax rate from six percent to five percent over a period of ten or more years.
The measure also contains a phased-in reduction in the income taxes paid by an individual on income from business interests eventually cutting the tax in half. In any one year, the drop in the tax rate would occur only if state tax collections had risen by at least $100 million in any of the prior three years.
In addition, the bill would raise personal income deduction from $2,100 to $3,100 for a taxpayer earning less than $20,000 in taxable income and the taxpayer's spouse -- essentially exempting that amount from the state income tax.
Missouri's income tax rates have not been increased since Gov. Warren Hearnes called the legislature into a special session in 1970 to raise taxes after his initial tax-increase bill passed by the legislature was rejected by Missouri voters.
Sen. Maria Chappelle-Nadal, D-St. Louis County, introduced a resolution of remonstrance Tuesday, Jan. 14, calling on Education Commissioner Chris Nicastro to resign.
If Nicastro refuses, the remonstrance calls on the state Board of Education to fire Nicastro.
The remonstrance cites several items including advice Nicastro offered to a group sponsoring an initiative petition to eliminate teacher tenure and her efforts in recruiting a private consulting company to provide advice on dealing with unaccredited school districts.
The resolution also cites decisions by the Education Board in stripping accreditation from the Kansas City School District and the Normandy School District in St. Louis County.
The Senate took no immediate action on the remonstrance that was assigned to the Senate Rules Committee.
Proponents and opponents spent hours Monday arguing before the House Workforce Development Committee legislation to give workers the right to refuse to join unions.
The measure, termed "right to work" by supporters, would prohibit any contract that requires a worker to join a union or pay union fees to obtain or continue employment.
Proponents of the bill argued the measure would make Missouri more competitive in attracting businesses from other states that prohibit forced-union membership.
But St. Louis Mayor Francis Slay told the committee that other factors are more significant in decisions by business in choosing a location.
"Competitive businesses don't go to the cheapest places," Slay said. "They go to the best places -- the places with skilled labor, quality of life, world-class universities, a good transportation system."
On the other side, supporters portrayed the bill as one providing choice and more freedom for workers.
"I believe that we must uphold their right to join a union, join a competing union or not join one at all," said the bill's sponsor, Rep. Eric Burlison, R-Springfield.
For the last several years, divisions within Missouri's business community over "right to work" has contributed to legislative inaction on the proposal.