Income tax cut, reform likely topics in expected special session

      A tax break for most Missourians and a restructuring of the state’s income tax brackets will likely be considered by legislators in a special session that Governor Mike Parson (R) is expected to soon call.

Representatives Peter Merideth (left) and Cody Smith (Photo: Tim Bommel, Missouri House Communications)

      That’s according to House Budget Committee Chairman Cody Smith (R-Carthage), who says he’s looking forward to seeing what the Governor outlines in a plan to be aimed at helping Missourians facing high prices and high inflation.  The top Democrat on the Budget Committee, Peter Merideth (D-St. Louis), says he wants a plan that goes beyond changing income taxes, so that all Missourians would be helped; not only those who pay that.

      Governor Parson earlier this month vetoed a proposed $500-million tax rebate plan sent to him by legislators in May, saying he prefers a permanent tax cut.  He has said he will call for a special session of the legislature to consider that cut. 

      Smith, who spearheaded that tax rebate plan as the best proposal thought possible at the time, said he would also prefer a permanent cut.  He spoke to Parson on Tuesday to get a better idea of what the governor might propose.

      “We are busy now collaborating with the senate and the governor himself to try to find a starting point and then from that point the legislature will take over and will hopefully put forth a good product, at the end of the day, for the governor to sign,” said Smith.  “It’s important that we try to keep this simple and try to make it as impactful to as many Missourians as possible.  I think the income tax is the best way to do that, and trying to simplify the tax code in the process I think is also a worthy goal.”

      Merideth said he and fellow Democrats were glad that the rebate plan was vetoed, but he’s concerned that a cut to the income tax won’t help the Missourians who need help the most. 

      “A third of Missourians don’t make enough money to pay [the income tax], and those are, of course, the third of Missourians that are having the hardest time right now, so if all we’re focused on is a tax cut on income, that’s not really a big help for people,” said Merideth. 

“That said, our income tax brackets are completely out of date.  We haven’t had updated brackets in like 100 years.  Democrats have actually long advocated for updating those to a more progressive tax rate structure.  Now, we have yet to see what that proposal’s going to look like but there’s a path that we could get on board with,” he added.  “Democrats are generally supportive of relief for those that make the least and generally resistant to relief for those that are doing just fine, at the expense of our long-term budget.”

      Smith agrees that the state’s brackets are outdated and should be revised, if not eliminated, and doing so would help all income earners.

      “Our highest tax bracket in Missouri is for anyone that makes over $9,000 annually.  At one time that was a considerable amount of money … but now most folks who work at all generally make more than $9,000 per year … so we [would be] helping lower income folks by addressing that top line number.  Additionally I think we can take a look at some of the tax brackets on the lower end and see if we can reconfigure those or eliminate those entirely so that folks on the lower end of the income spectrum won’t pay taxes up to a certain amount.  That would provide relief on those lower income folks.”

Merideth thinks permanently cutting the income tax right now is not a good idea.  He said the state is in a great position with revenue right now, but the next time there’s a downturn, cuts made now could put the state in a bad position. 

The governor has expressed confidence that Missouri’s good fortune will continue, and Smith agrees. 

      “I would guess that we may have a general revenue surplus in excess of $2-billion by the time we come back to the next legislative session and that is just unprecedented … we’ve got federal money set aside for Medicaid, we’ve got general revenue dollars sitting in the state’s treasury for all purposes, and I think there’s never been a better time to cut taxes and still be able to protect the priorities that we have in the budget,” said Smith.  “I think we’re probably looking at 3 to 5 years where we are very well situated even after a tax cut.”

      Smith said while the state is enjoying increased revenues and never-before-seen surpluses, Missourians are dealing with high inflation, high gas prices, and other factors that are causing many to struggle.  He said this is the right time for the legislature to do something to help.

      “Rather than issue stimulus checks, which is talked about in Washington from time-to-time, certainly we’ve seen that … I believe the best way to combat things like inflation is let [Missourians] keep more of their own money,” said Smith. 

      Merideth said he and other Democrats would also like to see the legislature talk about things besides the income tax, such as eliminating taxes on groceries and other essentials.   

      The governor has said he is also planning to have the legislature consider six-year extensions to tax credits under the Missouri Agriculture and Small Business Development Authority.  He vetoed a bill that would have extended them by two years.

      Dates for a special session have not been set. 

K-12 education gets big wins in proposed FY 2023 budget

      Missouri schools and teachers would receive a number of boosts in the state spending plan approved last week by the legislature; a state budget that is one of the largest ever.  The final total proposed to go to K-12 schools exceeds $10-billion.

Representative Rusty Black (Photo: Tim Bommel, Missouri House Communications)

“It is making an unprecedented investment in K-12 education in the State of Missouri and it is doing that in a couple different ways,” said House Budget Committee Chairman Cody Smith (R-Carthage).

      The top Democrat on the budget committee, Peter Merideth (D-St. Louis), said, “[This budget proposal] is moving us back in the direction of showing that we as a state, we as a legislature, value K-12 education.”

      More than $21-million was included to boost base teacher pay by $13,000 a year, to $38,000.  The plan is a state/local split, with districts covering 30-percent of the cost for that increase. 

      Another $37-million would restart the Career Ladder program, which rewards experienced teachers for taking on extra responsibilities and professional development opportunities. 

      Representative Ingrid Burnett (D-Kansas City), a former teacher, school counselor and principal, said she was glad to see the state resume funding career ladder, a program that she often took advantage of during her career. 

      “I found it really helpful.  It was part of our family budget.  It was how we paid for things like the summer vacation or braces for the children,” said Burnett.

      Rusty Black (R-Chillicothe), who chairs the subcommittee on education appropriations and also worked as a teacher for 32 years, also appreciated the career ladder funding.

Representative Ingrid Burnett (Photo: Tim Bommel, Missouri House Communications)

      “As somebody that received that once, I think there’s value in that for our students, not just teachers.  Students get something out of those extra hours that are spent with them trying to make their lives better.”

      School bussing would also see an increase over the current fiscal year’s budget.

      “There’s an additional $214-million appropriated there and that is, again, an unprecedented level of funding in that regard,” said Smith.

      Merideth spoke for many Democrats in praising that increase.

“Something that we’ve been funding at below 40-percent for the last number of years we’re finally funding at 100-percent.  That’s another 200-plus million dollars going to our schools for their transportation costs,” said Merideth, who said this could lead to additional boosts in faculty pay.  “The fact that we’re fully funding school transportation is going to give schools some flexibility to be able to provide the local match they need and to give raises elsewhere.”

      Black, who was an agriculture teacher throughout his career, was excited by proposed increases to match programs to benefit career technical schools.  Local districts could upgrade equipment or facilities if they come up with 25-percent or 50-percent of the cost.

      Black said this would, “Help students with up-to-date equipment to [be able to] leave school and go into the workforce and see something that’s not 30, 40 years old in the shop at school, and get into a place and oh, it’s got a computer attached to it.”

      Burnett said she was glad to see this level of support proposed for Missouri K-12 education.  She said past years, when less money was appropriated, were like when she was teaching and would be confronted by an angry parent. 

“If the administration doesn’t have your back, you can’t understand that until the administration doesn’t have your back … to help mediate the situation.  To give you support on how to engage with the parent in a way that was not going to be escalatingwhen the administration is not getting that from the state, it’s the same.  You just feel like you’re out there on an island.”

      Black and other lawmakers stressed that much of the funding in the spending plan comes from non-recurring sources, like federal stimulus and COVID response.  Part of the challenge in appropriating that money is in finding targets that will give schools the best chance of long-term benefit, rather than supporting programs that might go unfunded in future years when those funding sources aren’t available.

Representatives Peter Merideth (left, seated) and Cody Smith (Photo: Tim Bommel, Missouri House Communications)

“We just hope the people at the local level making those decisions are doing a good job making those decisions, spending this money that we have one-time to help reduce future costs so that those long-term items maybe with their local budgets, they can do a good job with,” said Black.  “One-time doesn’t automatically mean that it’s not going to be there next year, it’s just not making the guarantee to people that it’s going to be there.  Honestly in my years of dealing with government before this, there is no guarantee.  From year-to-year it’s a new budget and people making decisions at the local level, they know that too.”  

      The Fiscal Year 2023 budget would also provide grants or reimbursements of up to $1,500 to parents and guardians to cover tutoring and other services meant to catch up K-12s students who fell behind due to the COVID pandemic, and would provide pay increases to providers of the Parents as Teachers and First Steps programs.

      That spending plan is now before Governor Mike Parson (R).  If he approves it, it would take effect July 1.

House budget plan keeps Rock Island Trail development funds

      The state House has voted to preserve more than $69-million in federal dollars to support development of another hiking and biking trail on a former railway.  That funding survived two attempts to redirect it over concerns some House members have about its use.

Representative Tim Taylor (Photo: Tim Bommel, Missouri House Communications)

      Governor Mike Parson (R) recommended that appropriation, which would use funds from the American Rescue Plan Act (ARPA).  It would pay to revitalize a 78-mile stretch of the former Chicago, Rock Island, and Pacific Railroad corridor, commonly referred to now as the “Rock Island Trail.”  Work would include the stabilization of tunnels and bridges. 

      Bunceton representative Tim Taylor (R) said his family owns property along the Katy Trail, Missouri’s other hiking and biking trail along a former railway.  He said he’s seen how communities have benefitted from being along that trail.

      “It has brought a sense of small prosperity to our community.  When the railroad left, as it did on the Rock Island, much of the town ceased to exist.  We have prospered and those towns and cities along the Rock Island are going to prosper just like the Katy Trail.”

      The Rock Island corridor runs through Bland, hometown of Representative Bruce Sassman (R).  He said hiking and biking trails are engines for economic development, and this is Missouri’s chance to expand them.

Representative Bruce Sassman (Photo: Tim Bommel, Missouri House Communications)

      “I have been working on this Rock Island development project for 35 years, almost half of my life, and it’s a vision to create a trail system and a trail route that is unlike anything in the country and maybe in the world.  I wish you could see this project through my eyes.  I wish you knew the history of this project,” said Sassman.

      Taylor and Sassman were among those who spoke against amendments that would have blocked that $69-million from going to the trail.  One of those, offered by Chillicothe Republican Rusty Black, would have diverted that money to maintenance that has been deferred on other Department of Natural Resources’ properties.

      “In my eight years up here, every year we have had this fight with DNR about maintaining what we already have.  This is a one-time use of funds that, if we spend it on the trail, is going to further dilute the sales tax money that they get to use to maintain all of the other parks in the state,” said Steelville Republican Jason Chipman.  “What we have already is in bad shape and we could put a big dent in the maintenance needed for all of the other parks that bring in a whole lot of people to Missouri rather than partially work on this one.”

      “I think there’s arguments to be made for and against the Rock Island Trail,” said Representative Dirk Deaton (R-Noel), the House Budget Committee’s vice-chairman.  “I think it’s compelling to me as a conservative, as a fiscal conservative, you’ve got to take care of what you’ve got before you start taking on new things – building new things, acquiring new things, setting up new things, and we do have a substantial maintenance backlog within our state parks and so I think we really ought to address that before we do this, and then you can get to the question of, ‘If we do this.’”

Representative Scott Cupps (Photo: Tim Bommel, Missouri House Communications)

      Another amendment was offered by Shell Knob Republican Scott Cupps.  It proposed that the money be withheld from the project until lawsuits involving property owners along the Rock Island route are settled.

      “The rationale for that is there is concern that we will spend millions and millions of dollars on this project and, depending on what happens in federal court, we may not be able to complete it until this is resolved,” said Cupps.  “If you stand up for land owners’ rights and property owners’ rights … then you sure as heck better be a ‘yes’ on this.”

      Cupps noted that there were similar legal disputes for people who owned property along the Katy Trail, which he says weren’t settled until 11 years after that trail opened.

      Lawmakers who want work on the trail to proceed argued that those lawsuits’ outcomes will have nothing to do with Rock Island’s development.

Representative Jason Chipman (Photo: Tim Bommel, Missouri House Communications)

      “This is not about converting it back to ownership by these folks who are suing.  They simply seek to reclaim the money for land that was never part of their farm in the first place, whenever they purchased it,” said Representative Don Mayhew (R-Crocker).  “These lawsuits, this is a red herring.  It has nothing to do with it.  The state can proceed with this.”

      In the end the House voted down those amendments 53-81 and 62-70, respectively, and then voted to keep the money for the trail project in the budget. 

      Some, like Representative Jim Murphy (R-St. Louis), were glad to move forward that spending proposal.

      “When I leave here I think it’d be nice if I could look at one thing and say, ‘We did this for the future.  We did this for this state.  It’s long lasting.  We didn’t spend it on frivolous things.  We didn’t buy shiny objects.  We built something that our citizens can use now and in the future,” said Murphy.

      The House voted today to advance that spending plan to the Senate.

House bill to relax mandatory minimum sentencing signed into law

Judges will be able to ignore Missouri’s mandatory minimum sentencing requirements in some cases, under a House Bill that was signed into law this week by Governor Mike Parson (R).

Representative Cody Smith (photo; Tim Bommel, Missouri House Communications)

Missouri law requires that offenders with one prior conviction serve at least 40-percent of a prison term.  Those with two prior convictions must serve at least half their term, and those with three or more must serve 80-percent.

House Bill 192 contained language that would give judges flexibility in sentencing for some nonviolent offenses.  It was part of a broader look at criminal justice reform that House members have been pursuing over several sessions.

The language was proposed by Representative Cody Smith (R-Carthage).

“When Governor Parson signed House Bill 192 that was the most significant mandatory minimum sentencing reform, to my knowledge, that we’ve ever had in Missouri,” said Smith.  “That’s an incredibly rewarding feeling when we know that it’s become clear that harsh mandatory minimum sentencing for non-violent crimes only leads to bad outcomes, and this is a way that we can start to help change the trajectory of people’s lives.”

Smith said the number of people in Missouri’s prisons has steadily grown for decades.  He said many of those being incarcerated are non-violent offenders, who have a high rate of recidivism and of committing increasingly violent offenses.

“I’ve heard it said that prison is finishing school for hardened criminals,” said Smith.  “You go in for something that may be relatively innocuous in terms of violence … you come out and you’re a hardened criminal.”

Smith, who is also the chairman of the House Budget Committee, said reducing Missouri’s prison populations would also save the state money.  He notes that as recently as 2017, Missouri was on track to need two new prisons to accommodate the growing number of offenders.

“I believe that the mandatory minimum reform language that’s in House Bill 192 will help deter those costs by keeping people out of prison – again we’re talking only about folks convicted of non-violent crimes – keeping them out of prison is better for them, better for their families, better for society, and also better for taxpayers who don’t have to pay to keep them in prison.”

Ballwin representative Shamed Dogan (R) chairs the House Special Committee on Criminal Justice, which handled not only HB 192, but Smith’s original legislation, House Bill 113.  He said the mandatory minimum sentencing changes will allow judges those cases to be judges.

“That is something that will give people more second chances – people who shouldn’t be in prison as long as that mandatory sentence would determine,” said Dogan.  “A judge can look at that person’s overall life; they can look at the particulars of their offense, and really just letting judges do their job, which is to make tough decisions without having their hands tied behind their backs by mandatory minimum sentences.”

Other language in HB 192 will keep counties from putting an individual back in jail for failing to pay the cost of his or her earlier jail term.

The bill’s provisions take effect August 28.

Legislature proposes reforms to end ‘debtor’s prisons,’ mandatory minimum sentences

The Legislature has approved bipartisan legislation that would keep Missourians from being put back in jail for failing to pay the costs of being put in jail; and would eliminate mandatory minimum sentences for non-violent crimes.

Representative Bruce DeGroot (photo: Tim Bommel, Missouri House Communications)

House Bill 192 aims to end charging prisoners board bills” for their stays in jail.  Persons who don’t pay those bills can be required to come to a “show-cause” hearing and risk additional jail time.  Lawmakers said this amounted to putting people in a “debtor’s prison.”

The bill would allow counties to seek to collect jail bills through civil means, with no threat of jail time.  The House’s 138-11 vote on Monday sends that bill to Governor Mike Parson (R).

Bill sponsor Bruce DeGroot (R-Chesterfield) worked closely with Liberty Democrat Mark Ellebracht on the legislation.  DeGroot said current law is putting Missourians who’ve committed minor crimes and who can’t afford to pay fines and boarding costs back in jail, where they only incur more boarding costs.

“The people who don’t pay their fines and court costs who got put in jail because they couldn’t afford to bond themselves out, and now all of a sudden they owe $1300 for their week in jail and fines and court costs, and then they come before the judge and the judge says, ‘You owe $1300,’ and they say, ‘I don’t have it,’ and he says, ‘Fine, come on back next month and have at least $100,’ so they come on back the next month and they don’t have it and the judge puts them in jail, or they don’t show because they can’t get a babysitter or they can’t get off work, or they do get off work and they get fired,” said DeGroot.

DeGroot said in one case, a woman who stole an $8 tube of mascara incurred more than $10,000 in “board bills.”

Representative Mark Ellebracht (photo; Tim Bommel, Missouri House Communications)

Ellebracht said the legislation is proof that opposing parties who often vehemently disagree can come together to do good things.

“We worked well together on this issue because we worked as colleagues and we respected each other’s opinion, and we made what I regard as a very, very good bill, and we are correcting a problem that a lot of people face in the State of Missouri,” said Ellebracht.

The Senate added to HB 192 legislation to allow judges to waive mandatory minimum sentencing requirements for non-violent offenders who meet certain criteria.  That was the goal of House Bill 113, which the House passed in February, 140-17.

It was sponsored by Carthage Republican Cody Smith.

“It’s been shown in other red states like Texas and Oklahoma that if we change the way we treat folks – non-violent offenders – we can lead to better outcomes by keeping them out of prison, to the extent that that’s possible.  It leads to better outcomes in their lives, their families’ lives.  It leads to savings by not having people incarcerated in state prisons,” said Smith.

Springfield Republican Curtis Trent said both provisions speak to priorities that Governor Parson and Chief Justice Zel Fischer both spoke about when addressing the House and the Senate earlier this year.

“It’s a question of who we want in our prisons.  Do we want people in our prisons who are mainly a threat to themselves – they have poor judgement – or do we want people in there who are truly a threat to society, who are predators, who are going to victimize other people, not just for minor, monetary amounts, but in ways that are truly life-altering, and I think those are the people who we want to prioritize,” said Trent.

It’s now up to Governor Parson whether HB 192 becomes law.  If it does, it would take effect August 28.