Economy, taxes top list for Missouri Legislature

Taxes and economic development will likely dominate the final weeks of this year's Missouri Legislature, House Speaker Ron Richard said Thursday.

Speaking on a conference call with reporters outside the Capitol Building, the Joplin Republican said he would be pushing to send $1 billion to Missouri income tax filers by cutting tax rates. The cut would be temporary, enough to provide almost $650 to the average family of four by December 2010, he said. The money targeted for the cut represents about half of the "budget stabilization" funds allocated to Missouri under the federal stimulus plan enacted by Congress in February.

The tax change would be similar to, but deeper than, a permanent tax reduction sponsored by Rep. Scott Lipke, R-Jackson, that was approved in the House Thursday. Lipke wants to cut the top tax rate of 6 percent to 5.5 percent for people earning $9,000 or more and those earning less than $50,000. In addition, Lipke's measure would increase the deduction for dependent children and make more of a taxpayer's federal tax liability deductible.

Sending money to taxpayers, Richard said, is the most prudent step. He said that there has been a "feeding frenzy" among lawmakers trying to find building projects to use the money.

"Republicans and some members of the Democrat Party saw the total of some of the projects and decided it was unacceptable," Richard said. "So we decided to change course and send it right to the people."

The state construction budget, always the last item during work on a state spending plan, includes well in excess of $2 billion from stimulus funds directed to various construction projects around the state. At Southeast Missouri State University, the budget measures as now written include $11.7 million for campus maintenance needs and $4.5 million for the business incubator project.

Neither Richard nor Rep. Allen Icet, chairman of the House Budget Committee, were specific about what would be cut from the construction plans. The ones left, Icet said, would be those that are priorities and have a clear justification.

"We are attempting, and we will build, in some critical-needs areas," Icet said.

The tax cut measure, as approved Thursday, would reduce state revenue by $180 million annually, Lipke said. He expects that the broader, temporary cut will be added as the bill moves forward.

The tax measure will provide help to every taxpaying Missourian, Lipke said, and provide its own measure of economic stimulus. "We've got smaller communities, big communities and small business around town squares and they are all hurting," Lipke said. "We all know that the national economy is struggling."

The other major issue, also related to the economy, is a measure sought by Gov. Jay Nixon, a Democrat, with the support of Republican legislative leaders to eliminate the cap on the Quality Jobs tax credit program and take other steps to encourage economic development.

A bill approved in the House on a 141-19 vote is stalled in the state Senate, with Sen. Jason Crowell, R-Cape Girardeau, taking a leading stance against it. Crowell wants to limit the power of the Missouri Development Finance Board and make tax credits subject to appropriations like other state spending items.

Richard said he intends to go around Crowell's filibuster roadblock by attaching the economic development bill to other measures with a similar intent that have already been passed by the Senate. Once the bills are combined and a House vote is held, the measure can go directly to a negotiating conference committee to iron out the differences.

"What we have learned is that if we send a pure bill over" to the Senate "on varied subjects, it can get held up," Richard said. "So if it is important to us, whether it is about taxes, jobs or health care, we will send over multiple bills" to get it done.

rkeller@semissourian.com

388-3642

Pertinent address:

Missouri State Capitol Building, Jefferson City, Mo-