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NewsMay 13, 2002

JEFFERSON CITY, Mo. -- Although lawmakers sent a nearly $19 billion state budget to Gov. Bob Holden's desk on Friday, the job of getting it balanced remains before them in the final week of the 2002 legislative session. Putting together a spending plan for the fiscal year beginning July 1 in the face of slow revenue growth and rising financial obligations has been the dominant issue in the General Assembly this year. ...

JEFFERSON CITY, Mo. -- Although lawmakers sent a nearly $19 billion state budget to Gov. Bob Holden's desk on Friday, the job of getting it balanced remains before them in the final week of the 2002 legislative session.

Putting together a spending plan for the fiscal year beginning July 1 in the face of slow revenue growth and rising financial obligations has been the dominant issue in the General Assembly this year. With the FY 2003 budget at least $167 million in the red, lawmakers will continue to give money matters much attention during their final five working days.

With a constitutionally mandated adjournment deadline of 6 p.m. Friday, there will be little time left to finish work on other high-profile legislation, such as taxpayer subsidies for a new St. Louis Cardinals ballpark and other stadium projects in the state, property tax reform, and putting a transportation tax package on the statewide ballot.

However, no bill should ever be ruled dead until the closing bell sounds. After nearly four months of slow, incremental movement on legislation, the pace is always swift in a session's waning days.

Late last Friday afternoon, the new budget appeared derailed. But with less than an hour to go before the deadline for passing appropriations bills, lawmakers finished the job knowing the spending plan was out of balance.

"We still have a week to fill the void," said Senate Appropriations Committee Chairman John Russell, R-Lebanon.

The state Constitution doesn't require lawmakers to pass a balanced budget, but it does mandate that the state have one. The governor is empowered to do the job by vetoing individual items within the budget or withholding approved spending.

Holden, a Democrat, said he anticipates lawmakers will raise the additional revenue needed to balance the budget without further cuts.

"They have passed this budget in a bipartisan effort," Holden said. "I expect them to pass the revenue." Holden said he will not sign the budget unless at least some components of pending revenue proposals are passed.

One of those would generate up to $70 million by selling bonds secured by future payments the state will get as part of its settlement with tobacco producers over the public costs of treating sick smokers. Most lawmakers say passage is probable.

The other bill would close tax loopholes for businesses in the $50 million version already passed by the Senate. The House jumped that pricetag to $190 million with the addition of fee and tax hikes for riverboat casinos. A negotiating team will try to hammer out the differences.

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A transportation tax plan to send to voters has cleared both chambers, but in vastly different forms.

The original Senate proposal would raise $500 million for road and bridges with a 6-cent fuel tax hike and three-quarter-cent general sales tax increase. The Democrat-controlled House passed a $620 million package that includes a 3-cent fuel tax increase while raising the sales tax three-quarters of a cent.

Majority Republicans in the Senate are unlikely to accept such a large sales tax boost. If a compromise can be forged, voters would decide the question in August.

Reform bill may be stalled

A property tax reform bill, however, appears stalled. The bill attempts to prevent increases in homeowners' property taxes by fixing the "rollback" requirement.

When property values rise following biennial reassessment cycles, taxing jurisdictions like school districts must lower their tax rates. However, the practical effect of rollbacks has been to shift the tax burden from commercial property owners to homeowners. Commercial property is assessed on its earning potential, which changes little, while residential property is assessed on its fair market value, which usually goes up.

The bill would apply to the rollback differently to the various classes of property to protect homeowners. While the Senate has approved the bill, it has yet to be scheduled for House debate.

Senate President Pro Tem Peter Kinder's $644 million stadium package will likely be taken up by the House this week, but final passage looks to be difficult.

In addition to money for a downtown St. Louis ballpark, it would also provide state subsidies for projects in Kansas City, Springfield and Branson.

It took Kinder, R-Cape Girardeau, 20 hours of floor time in Senate to send the bill to the House. With floor time at premium this week and House opposition expected to be stiff, the clock is the biggest enemy to the plan's supporters.

mpowers@semissourian.com

(573) 635-4608

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