IT IS TIME TO GET DOWN TO SPECIFICS OF NEW TAX-LIMIT PROPOSALS

Reports of the demise of tax-limitation efforts in Missouri are, in Mark Twain's memorable phrase, greatly exaggerated. This is good, because the general concept is much too sound to die with this year's ill-fated effort.

In the wake of Amendment 7's overwhelming defeat, a growing chorus of leading organizations and bipartisan political leaders has declared support for drafting and enacting into law a better version of it. This past week saw two significant additions to the effort to strengthen Missouri's constitutional tax and revenue limitation. First, the Missouri Chamber of Commerce added its influential heft to the chorus. The next day, Gov. Mel Carnahan's top aide added a carefully worded approval to the idea, at least in theory. The Missouri Farm Bureau, with 81,000 member families and organizations in 113 counties, had kicked off this effort 48 hours after the Nov. 8 election when, joined by the Missouri Senate Republican caucus, they declared support for the effort.

What is the challenge faced by drafters? Stated simply, lawmakers and supportive organizations must strengthen the original Hancock Amendment without entirely abrogating the taxing powers the Missouri Constitution gives to the General Assembly, and without unduly hamstringing cities and counties where local fees are concerned. Overwhelming support exists for a measure with three characteristics.

Public vote: First, it should leave no doubt in forcing to a public vote large tax increases such as Senate Bill 380's $310 million.

Local flexibility: Second, it should preserve some measure of flexibility for localities to deal sensibly with local needs as they arise.

Not retroactive: Third, it shouldn't involve complicating issues such as the retroactive repeal of taxes the voters have already approved.

Drafting a measure that meets each of these standards will be no easy task. The Hancock Amendment voters approved in 1980 is not, as is popularly supposed, a provision requiring public votes on tax increases. Rather, it is a limitation on the amount of revenue state government can collect, which is capped at 5.64 percent of total Missouri personal income. If state government collects more, then it must either institute refunds to taxpayers or hold an election to approve the higher taxing and spending levels.

One fact is evident from a proper understanding of this constitutional provision, as currently written. The determination as to whether tax refunds have been triggered or a vote must be held can be made only retroactively. That is, officials of state government must wait until all revenue has been collected and then measure it against that year's personal income to discover whether the maximum permissible level of personal income has been breached.

The challenge for drafters, then, is to somehow improve a limitation measure that currently operates after the fact, and rather clumsily at that. Still, we have no doubt that an overwhelming majority of Missourians wanted tax increases like SB 380, which was the legislatively approved school-finance reform legislation, and even smaller measures, say in the $100-200 million range, to go to a vote of the people. To the drafter who accomplishes a clean version of an amendment that achieves this will go the thanks of a grateful citizenry. Drafters of both parties should redouble their efforts.