Legislative update: Tax proposals make headway

Editor’s Note: Below are articles on recent Missouri General Assembly moves provided to Springfield Business Journal by the Missouri Press Association.

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Proposal would give voters a say in controversial taxing system
A state proposal aims to stem abuse of a controversial taxing mechanism and would give voters a say in the process.

State Rep. Brandon Ellington, D-Kansas City, proposed a resolution that would require future tax increment financing districts to be approved by the majority of voters in the area affected by the district. If approved by lawmakers, the resolution would then require approval as a constitutional amendment. A TIF is a special tax entity meant to encourage development of blighted or rundown areas.

Ellington, whose district encompasses southeast Kansas City, told a House committee on March 8 businesses often abuse the financing system, draining away money from blighted areas. A vote by the area's residents would aid accountability, he said.

When a developer builds in an area, property values often rise. Property taxes follow suit, and the extra revenue goes to the city, county and school districts. But when a TIF is created, the extra property tax revenue and some sales tax revenue is instead reinvested into the district, and can be used to pay for new roads and infrastructure around the development.

Supporters say the economic benefits, such as increased sales tax revenue divided between the surrounding city or county and TIF, make it a win for everyone involved. However, the tradeoff is the city, county and school districts surrounding the TIF lose out on the extra property tax revenue, opponents say.

Elderly, disabled renters face cuts to property tax aid
Missouri seniors and those with disabilities who rent their homes would lose a property tax rebate in legislation approved by the House Budget Committee March 8.

Under House Committee Bill 3, funding from a circuit-breaker tax credit — which allows elderly renters and those with disabilities to stay in their homes by negating property taxes — would instead be used to make up for proposed cuts to the state’s health care funding.

"This is obviously a very challenging budget year," said Rep. Scott Fitzpatrick, R-Shell Knob, sponsor of the bill and chairman of the budget committee. "But the fact remains that our Medicaid budgets are growing hundreds of millions of dollars a year."

The bill, which has now become part of the proposed House budget, would help fund home- and community-based health services, which face a $52 million cut in Gov. Eric Greitens' proposal for the 2018 fiscal year. Greitens subsequently recommended $41 million from a tobacco lawsuit settlement be used to help cover the cuts, but some lawmakers have questioned whether using a one-time funding source is the best idea for dealing with an ongoing expense.

The proposal has met strong opposition among Democrats and the disabled community in the state, who believe there are other options for cost savings.

Medicaid debate in legislature focuses on flexibility, finances
As the fight over health care dominates discussion in Washington, D.C., a quieter debate is taking shape in the Missouri General Assembly that could fundamentally alter the way health care is delivered to the state's most disadvantaged residents.

Missouri state legislators, who have long had to balance state budgets with continuous increases in health care expenditures, have placed Medicaid funding in the crosshairs. Earlier this year, Greitens targeted benefits for the elderly and disabled but cut other areas, such as higher education and K-12 school transportation.

One solution being strongly considered by some Republicans would radically alter the way Medicaid is funded in Missouri. Proponents say it would give the state more control over costs while opponents say it would result in cutting crucial medical services and programs.

Arguments over Medicaid on a state level mirror the combative debates around health care at the federal level. President Donald Trump and congressional Republicans ran on a platform of "repeal and replace" in regard to the Affordable Care Act, ultimately releasing their own health care bill which would dismantle some of the ACA's policies.

One of the policies from the ACA that congressional Republicans have targeted for eventual removal is the Medicaid expansion policy. The ACA offered an expansion of Medicaid for residents that live at 138 percent of the federal poverty line. After a lengthy legal battle, the Supreme Court issued a proclamation that the federal government could not force states to implement the expansion, leading to a fragmented Medicaid system as states decided whether they wanted to participate.

Missouri is one of 19 states in the country that refused to expand Medicaid under the ACA, and many Republicans in the General Assembly speak harshly of the policy. On the campaign trail and after the election, Greitens blamed the ACA for contributing to Missouri's budget crisis.

Fitzpatrick, the chairman of the Missouri House Budget Committee, said implementing the Medicaid expansion would hurt Missouri's overall financial state.

"The last numbers I saw is that expanding it would increase the spending total by over $2 billion," said Fitzpatrick. "So, if the feds pick up 90 percent of that, that's $200 million the state has to pick up. So that's more money we have to spend, because right now those people are not on Medicaid."

Crimes proposed for protestors blocking roadways
Protesters who block roadways would face criminal charges under a measure debated by state lawmakers March 7.

State Rep. Nick Marshall, R-Parkville, said during a meeting of the House committee on crime and public safety that protesters should not interfere with drivers.

Marshall, who sponsored the bill, said the right to protest is vital to a democracy. However, he said, "in the last few years, we've seen peaceful protests and assemblies turn into mobs, which have breached the public peace and order and violated the rights of citizens."

House Bill 826 addresses part of that issue, he said.

"That problem is the blocking of vehicular traffic, which is trapping citizens in their cars and unlawfully detaining them," Marshall said.

Rep. Bruce Franks, D-St. Louis, protested in the aftermath of the Ferguson shooting.

"I would've had a felony if this law was in place," Franks said.