Tax cuts threaten quality of public services:
According to many Missouri politicians, the state can cut taxes even while planning to spend more money than it takes in. But the numbers do not compute.
Missouri’s fiscal problems aren’t as bad as the widely reported crisis that Kansas is suffering. But they are headed in that direction, potentially affecting 6 million Missourians.
The state soon may have to reduce financing for K-12 schools, public universities, social programs and other services. Missouri already under-funds many of these vital programs, so further budget cuts could leave the state in an even weaker position to compete for new residents and jobs.
Gov. Jay Nixon last week provided a needed lesson in fiscal responsibility. He vetoed special-interest tax breaks passed by the legislature, pointing out they could drain several hundred million dollars from the budget. But because Republican leaders vow to try to override the vetoes this fall, Nixon must be prepared to slash proposed spending for state programs as early as next month.
The Star recently reviewed Missouri’s general fund receipts through May, which is the 11th month of the 2014 fiscal year. It also reviewed predictions for the 2015 fiscal year that starts July 1. Some of the findings:
— Missouri expected to have about $7.45 billion in general fund receipts by May 31.
Instead, it had $7.32 billion, a shortfall of $130 million.
— Missouri took in about $40 million less than projected in individual income tax receipts, the biggest contributor to the shortfall.
Kansas, because of large tax cuts passed in 2012, was $282 million behind in personal income tax revenues in a general fund budget of $5 billion.
(Missouri’s income tax cut, passed this session over Nixon’s veto, will not take effect for several years. But when it does, the state could see a drop of $600 million annually in tax revenues.)
— Missouri has a cash balance of $200 million it could use to balance the budget. Missouri also has a budget reserve fund of about $540 million. Up to half of the latter could be used to pay the state’s bills, though that money would have to be paid back by the end of the fiscal year.
Missouri’s budget woes aren’t forecast to ease in the 2015 fiscal year.
That’s partly because, even with supposedly conservative Republicans in charge of the legislature, the state appears ready to spend more than it collects.
The state’s expected general fund revenues are $8.59 billion. But lawmakers have approved total general fund spending of $8.96 billion.
The $8.59 billion in projected receipts may not be realistic, either. Budget estimators calculated a 4 percent growth rate over this year. However, the state is unlikely to reach even the 2.8 percent growth goal set for this year. If Missouri ends the year $130 million in the red, for example, it would need a 6 percent expansion of revenues to reach $8.59 billion in the next fiscal year.
By comparison, Kansas experts predict a growth of only 0.5 percent in that state’s revenues in the next fiscal year.
Yet another big and potentially costly unknown looms.
Republican leaders contend the state needs to cut its taxes. That mindset led to the parade of special tax breaks they helped pass in the recent session. If passed over Nixon’s vetoes, the bills reduce general fund revenues by $250 million.
GOP officials must be challenged in the September veto session to show whether there’s any credence to their claim that these tax changes will help the Missouri economy.
GOP legislators can be expected to trumpet how they are “returning money to the people.” But that claim quickly becomes hollow if legislators aren’t willing to say what services they will cut to do that.
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St. Louis Post-Dispatch, June 16
Right-to-farm amendment is a waste of time:
Back in 2010, when the Humane Society of the United States targeted Missouri for being the nation’s puppy mill capital, one of the key defenders of an industry known for stacking dogs in filthy and inhumane cages defended the practice like this:
“I am an American; I have a right to raise dogs,” Joe Overlease, president of the Professional Kennel Club of Missouri, told the New York Times. Mr. Overlease’s shelter had previously been cited by the state for violating overcrowding standards. “I have a right to bark at the moon if I want.”
Barking at the moon is an apt description of how parts of the state’s agriculture community responded to puppy mill reforms created by the passage of Proposition B in 2010. This August, Missourians will vote on what’s being called the “Right to Farm” constitutional amendment. It is the fearful farm faction’s overreaction to the puppy mill reforms.
They’re barking at the moon. Because it’s their right. But the rest of the state shouldn’t bark with them.
The premise behind Amendment 1 is that farming in Missouri is under attack. The evidence is dubious, but since when did a lack of evidence stop the Missouri Legislature?
When voters passed Proposition B, for instance, pro-puppy mill lawmakers immediately thumbed their noses at voters and declined to enact the reforms approved by voters. In the end, with help from Gov. Jay Nixon, a compromise was passed that at least fulfilled some of the spirit of the proposition. Unlicensed puppy mills were targeted and stiffer regulations were enacted.
If farming is under attack, you’d think farm values would be down. But the most recent survey from the University of Missouri Extension Service shows that farmland values are up throughout Missouri. The Federal Reserve Bank of Kansas City reported similar gains. The price for irrigated cropland, for instance, was up 25 percent from the previous year.
Amendment 1 is a solution looking for a problem, and it’s not even clear what the solution would do.
Charles Kruse, president of the Missouri Farm Bureau, believes the proposal will give farmers some extra legal protection in an era that has seen some corporate farm practices come under attack. Voters in California, for instance, passed an amendment to bring more humane practices to the poultry industry.
If he’s right, that may be the best reason to vote against the amendment. The last thing Missouri needs to do is give more protection to an industry that already gets almost anything it wants out of the Missouri Legislature and Congress.
Keep in mind, as much as people like Mr. Kruse like to talk about the small family farmer trying to protect his way of living, this is a battle funded by large corporate food interests. It is the Tysons and Smithfields, the industrial poultry and pork producers, who more than any other element of the food chain decide what Americans pay for food.
Changing the state constitution to give extra protection to an industry that has had its way in Missouri since the founding of the state shuts consumers out completely.
Some observers, like state Rep. Chris Kelly, D-Columbia, believe the amendment really does nothing. They argue that it was watered down enough in the legislative process that in the end all it does is reinforce that Missourians care about farms. Mr. Kruse, in a meeting with the Post-Dispatch editorial board, suggests that conversations about farming, like the one we had, are the goal.
OK, fine. Let’s talk about farming. Let’s break down some of the traditional barriers between rural and urban Missouri. But let’s not change the constitution to do that. It’s unnecessary.
Passing an amendment that likely does nothing, but might possibly provide large corporations extra protections against consumer interests, is very bad public policy.
Farming is, always has been, and likely always will be an important part of life in Missouri. Even some of our largest urban corporations, the Monsantos and Pfizers and Purinas and Anheuser-Busches, have a direct connection to the farm. That’s not going to change, and no occasional concern over inhumane treatment of animals will ever, as Mr. Kruse suggested in 2010, “eliminate the livestock industry.”
Vote No on Amendment 1. Let Mr. Kruse and his pals howl at the moon all they want. But don’t enshrine moon-howling in the Missouri Constitution.
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St. Joseph News-Press, June 15
Fairness left out of equation:
Regrettably, Missourians who care about the future of their transportation system have been presented with just one funding option on the August ballot: a poor one.
Multiple studies and recommendations, including those issued last week, support the need to improve and maintain our expansive system of major highways, lettered state roads, bridges, airports and railroad infrastructure.
In the details, there is much that is obvious and some expensive items that should be questioned — either for their necessity or their urgency. But it’s hard to argue these spending proposals have not been studied in detail and prioritized in partnership with interested citizens around the state.
You cannot say the same for various credible transportation funding ideas that never saw the light of day or for the suspect one that has made it to the ballot in the form of Amendment 7. It’s as if those who championed placing this before voters knew what they had:
— An ill-advised increase of three-fourths of a cent to the already spiraling sales tax.
It’s time our elected leaders recognize they do not operate in a vacuum. From St. Louis to Kansas City and St. Joseph, the sales tax is reaching a previously unthinkable area: double digits. If this passes, the general sales tax in St. Joseph will hit 9.2 percent before assessments are added in special taxing districts.
— A massive shift in responsibility for highway funding.
Historically, roads in Missouri have been funded by the users — primarily by taxes that motorists and truck operators pay on fuel and vehicle purchases. The ballot plan amounts to what is said to be the largest tax increase in state history, a projected $5.3 billion to $6.1 billion over 10 years. And it apparently would mark the first time general sales tax revenues have been earmarked for roads and bridges.
This matters because lower-income residents pay a higher proportion of their incomes in sales tax but use the highways less than average. Meanwhile, the truck operators who stand to benefit greatly from road investments hardly would be impacted.
— A restrictive plan that locks in inequity.
By passing this measure, voters will take any consideration of toll roads off the table and commit to not raising our sixth-lowest-in-the-nation gas tax during the duration of the higher sales tax. As a result, there is every reason to think our method for funding highways will appear even less equitable a decade from now.
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The Joplin Globe, June 11
Important priority:
If Missouri is serious about protecting its children from abuse and neglect, then it also has to be serious about training and paying those on the front lines.
It makes no sense that an employee with a master’s degree working at the Children’s Division of the Missouri Department of Social Services is likely to make the same beginning wage as a one-year hire.
There is no merit pay or pay scale being used. Nor is there any incentive for good employees to stay.
Missouri Rep. Bill Lant, R-Pineville, has recognized the dysfunction in this division and is making it his priority this summer to hold hearings to find a way to solve the problem.
We applaud the Southwest Missouri legislator for his determination in tackling the problems of child abuse and neglect in our state. But then we think his eyes are wide open to the problems of abuse. Lant told the Globe that the story of 9-year-old Rowan Ford, the Stella girl who in 2007 was abducted, raped and murdered, keeps him diligent.
The first year Lant was in the House, he helped pass a bill that made everyone who has interactions with children mandatory reporters of child abuse and neglect.
The next year he sponsored legislation that formed the Joint Committee on Child Abuse and Neglect. The committee began meeting last summer to determine where the problems lie in the Children’s Division.
This summer he and others are looking to fix those problems.
We think Lant’s approach is a good one.
When he returns to Jefferson City in January, he will be ready to back legislation that will make changes in the Children’s Division. If you see Lant this summer, encourage him and add your ideas.
We sincerely hope these efforts can make a difference for our children.