Mo. House passes flurry of tax bills, constitution changes

JEFFERSON CITY, Mo. -- Missourians' taxes would have been cut by hundreds of millions of dollars, and voters would have decided next year whether to abolish the income tax and approve a $700 million bond package for new college buildings.

If only there were no state Senate.

The Missouri House during the 2009 legislative session that ended Friday approved nine constitutional amendments -- all of which could have appeared on the 2010 ballot -- and more than a dozen tax cuts, breaks and incentives.

Few went anywhere in the Senate, where only two constitutional amendments and a few tax breaks were approved. The Missouri Capitol lived up to the saying that "the House proposes and the Senate disposes."

House Majority Leader Steven Tilley said the legislative flood was about bargaining.

"If you start at your bottom dollar and go down from there, you're negotiating with yourself," said Tilley, R-Perryville. "So if you're on the premise that we shouldn't send stuff to the Senate that we wouldn't want to become law, I don't think that's how we've ever operated. We've always started high and tried to end up somewhere in the middle."

Minority Democrats -- generally on the receiving end of that leveraging -- said the deluge was less about compromise and more about a lack of a coherent plan.

"The Republican bosses in this building simply had no idea of what they wanted," said Minority Leader Paul LeVota, D-Independence.

The House, at various times, approved tax breaks for businesses, focused them on small employers, used them to encourage people to take certain actions and steered them toward economic development.

The highest-profile tax cut would have lowered Missouri's income tax rate by one-half percentage point starting in the 2009 tax year. The Department of Revenue estimated the tax cut would have saved about $50 annually for someone with a taxable income of $10,000 and saved $500 annually for those with a taxable income of $100,000. It would have cost the state $463 million a year.

Republicans in the House planned to pay for it by using some of the federal stimulus money, calling the tax cut a government program that could boost the economy. But the idea gained no traction in the Senate.

Rep. Mike Sutherland, chairman of one of the House's tax committees, said the GOP spent the session looking for ways to cut taxes and boost spending by individual consumers. He said the smattering of tax bills was designed to give the Senate options, with no intent that they all would become law.

"We had one policy: to overall try to figure out ways to reduce the tax burden on the people of our state," said Sutherland, R-Warrenton.

That effort took several forms. It meant exempting military retirement pay from income tax, waiving state sales tax in July after Independence Day, diverting the unused portions of existing tax programs to help dairy farmers and waiving sales taxes on utilities and equipment for underground storage facilities.

Senate Majority Floor Leader Kevin Engler, R-Farmington, said House and Senate leaders communicated well in the session's final days and passed most of the priority bills.

Besides passing multiple tax cuts, the House also approved numerous constitutional amendments. The proposed constitutional amendments sought to:

-- Change judicial selection.

-- Allow prayer in public schools.

-- Make it easier to tap a budget reserve fund.

-- Cap state spending.

-- Approve $700 million in bonds for college construction.

-- Replace the income tax with a higher sales tax.

-- Require that union elections be conducted by secret ballot.

-- Make the St. Louis County assessor an elected position.

-- Allow former prisoners of war who are fully disabled to claim an exemption on local property taxes.

Only the final two passed the Senate and thus will appear the ballot, likely in November 2010. House Speaker Pro Tem Bryan Pratt, after he was asked by a reporter about the quantity of proposed constitutional amendments, quipped that "it would be a busy ballot."

Pratt, R-Blue Springs, said House leaders wanted them to pass, but he acknowledged that even fitting all of them on the ballot could have been tough.

A spokeswoman for the secretary of state's office said there are no legal restrictions on using ballots that take up multiple pages. In 2008, the largest ballot was in St. Louis County, which fit 44 different questions on a sheet of paper that was more than a foot-and-a-half long.

Rep. J.C. Kuessner, who has sought to make it harder to change the constitution, said the proposed amendments have turned into a "political volleyball" used by political parties to drum up voter turnout.

"The Senate does filter those things out, and thank goodness for that," said Kuessner, D-Eminence.

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On the Net:

Legislature: http://www.moga.mo.gov