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MPANewsBook: Statehouse News for MPA Members: 1/29/2010 - MPA NEWS 1/29/10

Members of the Senate Appropriations Committee expressed concern that $300 million of Gov. Jay Nixon's budget proposal is based on uncertain federal funds.

The federal funds would come from a six-month extension of an enhanced match rate for Medicaid funding which is in a current jobs package and other health care legislation that are both still under debate in Congress, state Budget Director Linda Luebbering said.

"You are banking on speculation," Sen. Kurt Schaefer, R-Columbia, told Luebbering. "We have no guarantee the state of Missouri is going to get that money."

Luebbering said the federal money in question could be decided before the Appropriations Committee finalizes its budget numbers.

Committee Chairman Robert Mayer, R-Dexter, said it was too early to say whether he would support a budget based on $300 million in speculative funds.

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Republican senators are beginning to attack Gov. Jay Nixon's budget proposals for education -- arguing it is not enough.

For the current fiscal year, Nixon's recommendations would leave a program that provides state funds for public schools $43 million short. While Nixon recommended an increase to the program of $18 million, full funding of the program would require a total of $106 million, state Budget Director Linda Luebbering said.

Under provisions in the funds law, the Education Department must formulate the minimum required to educate each student in the student's district.

"I think the state of Missouri is going to get sued," warned Sen. Kurt Schaefer, R-Columbia, about the state's failure to fully fund the program. "I am extremely concerned about that."

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A State Tax Commission recommendation to raise taxes on some Missouri farmland is close to rejection by the General Assembly.

Following controversial debate in both the Senate and House Rules committees, two resolutions were passed out of committee that would reject the commissions assessment. Both the House and Senate approved the measures in separate landslide votes.

Rep. Brian Munzlinger, R-Williamstown, said the issue is gaining much attention from legislators. He said the difference between the two resolutions does not matter, and the final goal to stop the commission's rule from going into effect should be accomplished, pending few technicalities.

"Agriculture is the No.1 industry in Missouri and this issue will raise the cost of food and its production, affecting all Missourians."

Sen. Joan Bray, D-St. Louis County, said she was concerned that rejecting the commissions recommendation would place a greater burden on residential and commercial taxpayers.

Both resolutions are expected to be sent to committees next week. The deadline to reject the commissions assessment is the end of February.

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Gov. Jay Nixon's plan to provide incentives to state businesses met with little opposition from witnesses at a House committee hearing Jan. 27.

The House Job Creation and Economic Development Committee heard testimony from advocates for and against the legislation - the effective start of formal debate on Nixon's plan.

Proponents of the plan, which would establish the Missouri Business First Act and provide new tax credits, said the bill would create jobs and encourage loyalty among Missouri businesses.

Testifying in opposition, Bruce Hillis, director of the advocacy group Missouri First Inc., said Nixon's plan would compromise free market principles. Missouri First Inc. shares the name of the governor's plan only by coincidence.

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Lawmakers continued discussion on a plan to dramatically alter the state's current tax structure.

Sen. Chuck Purgason, R-Caulfield, proposed an amendment that would do away with the state's income tax and replace lost revenue by increasing sales tax.

Under Purgason's proposal, the current sales tax would expand to include items and services not currently taxed, such as rent and prescription drugs.

Legislators said they estimate the current 4.2 percent sales tax would increase to 5.1 percent to 11 percent. Rep. Chris Kelly, D-Columbia, said he supports the amendment "if they can work out the problems.

Kelly said his concerns include a decrease in Missouri business, as citizens living in border cities could be driven across state lines to make purchases. Additionally, Kelly said, Internet shopping could become a cost effective alternative for those looking to avoid a sales tax.

Purgason said he acknowledged these concerns, but pointed out Missouri's sales tax is currently lower than all eight bordering states.

Jim Moody, a lobbyist and former state budget director, said people with high wealth and passive income - such as capital gains, interest, and dividends - would benefit most from the proposed amendment. Moody added that health care, professional services and utilities would be most affected by this change. Moody's lobbying clients include businesses and health care providers.

Kelly suggested keeping the sales tax increase low and raising additional funds from another source, so as not to burden lower income households.

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Parents of children with autism are one step closer to mandated insurance coverage for their children.

Senate committee members voted unanimously Jan. 26 to pass a bill that would require insurers to cover the diagnosis and treatment of autism and related disorders.

Gov. Jay Nixon has advocated for the bill and commended the committee's action.

Early diagnosis and treatment practices have been found to be very effective in treating children with autism, Nixon said.

Opponents of the measure argue the bill would increase health insurance costs.

Last year, a similar measure was passed by the Senate, but stalled in the House.

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Lawmakers are facing significant challenges in crafting a budget with less cash that would also stay true to a pledge they made to protect funding for public education.

Parents as Teachers, a nationally recognized early-childhood education program funded by the Missouri Elementary and Secondary Education Department, will receive less funding for the second straight year.

Under Gov. Jay Nixon's proposed budget, the program would receive $26.7 million, $4.1 million less than the amount appropriated the year before. That amount was more than $3 million less than the preceding year.

Education Department Assistant Commissioner Gerri Ogle told a Senate Committee that his department tried to avoid requests for additional funding when drafting its budget proposal.

The Associated Press reported that Parents as Teachers public policy director Jane Callahan said the cuts would hurt parents and children.

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Senators called into question a more than 60 year-old tax credit that allows insurance companies to deduct taxes from an insurance policy premium tax.

In a meeting of the Joint Committee on Tax Policy, Sen. Brad Lager, R-Maryville, said he is trying to figure out why the credit - which last year resulted in more than $8 million in deductions for insurance companies - is still on the books.

"The answer that we've done it for 60 years is not acceptable," Lager said.

Members of the committee also called for improved tracking of the state's 54 active tax credits and a better accounting of their economic impact.

"If a business was spending billions of dollars and didn't know what it was getting for it, it wouldn't be in business very long," Rep. Mike Sutherland, R-Warrenton, said.

The state is obligated to roughly $2.5 billion in tax credits over the next five years, Lager said.

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A measure that seeks to alter the current interpretation of the U.S. Constitution by some legal scholars passed through a House committee Wednesday.

Without opposition, the House Budget Committee approved a resolution that would call for an amendment to the U.S. Constitution requiring a balanced budget.

"The worst problem, of course, is the growth of federal power that arises from being able to appropriate without limitation," said Chris Kelly, D-Columbia, a sponsor of the resolution. "That is what scares me the most."

Missouri had passed a resolution in 1983 that called for both a balanced budget and a constitutional convention. So far, 20 states have passed similar balanced-budget resolutions-- leaving the measure 14 short of the number required to trigger a Constitutional convention.

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The state's insurance department wants to make purchasing Medicare safer for Missouri's seniors.

Senate committee members heard a bill that would enforce existing guidelines on Medicare sales practices. The bill would also allow seniors to receive a refund for part of their long-term insurance policies and Medicare supplement policies premiums.

A contentious issue within the bill involves adopting federal sales practice guidelines, including those from the Centers for Medicare and Medicaid Services. The bill deems a number of trade practices unfair such as cold lead advertising -- also known as 'cold calling' -- and door-to-door soliciting. Insurance sellers are also not allowed to use an appointment made for Medicare sales to discuss other kinds of insurance, such as life insurance or health insurance.

Sen. Norma Champion, R-Springfield, testified the she has personally received a high volume of mailers, some even advertising that they're concerning the recipient's Medicare. "It's very confusing," she said.

Sen. Jason Crowell, R-Cape Girardeau, said he wanted more information before voting to adopt the federal guidelines.

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The U.S. Agriculture Department has awarded $19.1 million in stimulus funds Ralls County Electric Cooperative to provide increased broadband services, department spokesman Bart Kendrick said. The money will be appropriated in both grants and loans.

Scott Holste, a spokesman for Gov. Jay Nixon, said the governor had worked with the cooperative to obtain these federal funds.

PDF Telecommunications had previously filed a public notice that they currently service a small portion of the area targeted for the funding.

Drew Peterson, spokesman for PDF, said "it is certainly philosophically our preference that the federal government try and deploy resources to customers that currently do not have broadband services." Peterson added that his company only serves a small portion of the area and did not know if other companies, such as AT&T, currently service a larger portion of the area.

PDF Telecommunications has received stimulus funding for projects in other areas of the United States.

Students who use text message, social networking sites, and other electronic mediums to harass and intimidate their peers would find themselves in trouble if a bill heard Jan. 27 is enacted.

Rep. Yvonne Wilson, D-Kansas City, has sponsored a bill that would require every public school system to enact a bullying policy and include electronic communication. Her measure, however, does not define cyber-bullying.

One of the first high-profile cyber-bullying cases happened in Missouri more than three years ago. Megan Meier, 14, hanged herself in her Dardenne Prairie home in 2006 after being repeatedly taunted by a woman posing as an adolescent boy on MySpace.

"We are seeing this all over the place and it's a serious problem," said Wilson, a former school teacher and principal. "If you look at the news, it's a real issue that impacts a lot of people."

Last year, similar legislation passed the Senate, but never came up for a vote in the House before the session ended in May.

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Requiring suspected drug users applying for welfare to be tested is continuing on the fast track.

The bill was moved out of the Rule Committee Jan. 25 with no debate and a 7-4 vote along party lines.

Rep. Ellen Brandom, R-Sikeston, the sponsor of the bill, said in an earlier health care committee meeting that taxpayers do not want to subsidize drug use.

One Democrat who voted against the bill, Rep. Jake Zimmerman of St. Louis County, said the intent of the bill was good, but too many non-standard rules attached to Temporary Assistance for Needy Families can lead to a loss in federal funds.

The bill will be one of the first heard on the House floor.

Sen. Jason Crowell, R-Cape Girardeau, is sponsoring a similar legislation in the Senate.

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A bill that would put Valentine's Day on the same level as Super Bowl Sunday for liquor laws will be one of the first bills headed for debate by the Missouri House this legislative session.

Valentine's Day falls on a Sunday this year, and if the proposed bill is not passed bars and restaurants without a Sunday permit - but with a regular liquor permit - could not sell liquor.

The bill passed the House Rules Committee by a 9-2 vote Jan. 25.

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President Obama said he is open to construction of alternative energy solutions, specifically naming nuclear power in his State of the Union speech.

Callaway County has Missouri's only nuclear power plant, and last April, AmerenUE ended talks about building a second in the state.

Many Missouri legislators are in favor of building another plant. Some legislators said the plant would create jobs and reduce dependence on coal and foreign oil.

Sen. Delbert Scott, R-Lowry City, said he believes the future depends on whatever resources we have and the state's long-term future is reliant on nuclear energy.

The St. Louis Post-Dispatch reports The White House has awarded $1.1 billion in federal stimulus money to construct a high-speed rail between St. Louis and Chicago.

Additionally, Missouri will also receive $31 million for eight projects to upgrade rail service between Kansas City and St. Louis.

The high-speed corridor between St. Louis and Chicago will offer three trips daily at speeds of 110 miles per hour along most of the route, the Post-Dispatch reports.

A new federal texting while driving ban would be difficult to enforce on charter bus drivers and truckers, according to the Missouri State Highway Patrol.

"It will be difficult to see up inside the tractor trailers," said Missouri State Highway Patrol Captain Tim Hull.

Hull also said it would be easier to determine if a commercial driver was texting while driving following an accident where death or injury occurred. Under those circumstances, he said the Highway Patrol could access a drivers cell phone data records.