TAX-LIMIT MEASURE HAS GAPING HOMES; IT'S UP TO SENATE

Before leaving Jefferson City for a 10-day spring break last Thursday, the Missouri House of Representatives passed and sent to the Senate a tax-limitation proposal. While Gov. Mel Carnahan is claiming it as his bill, it is important to note that the proposal that won House approval is far different from the weak measure he originally proposed.

As originally proposed by Gov. Carnahan and the Missouri Farm Bureau, the idea was weak on several fronts. It was altogether lacking in an enforcement mechanism. For example, there was no penalty for non-compliance. Moreover, as State Auditor Margaret Kelly correctly observed, the Carnahan/Farm Bureau proposal was so loosely drawn that, with a few minor adjustments in phasing in the taxes, the governor could have pushed the now-infamous Senate Bill 380's entire $310 million tax increase through its gaping loopholes. It was clear that such a flawed measure would have been a cruel hoax on Missourians and would have caused greater public cynicism and loss of confidence in our elected leaders.

Missourians are indebted to the state auditor and to the House minority leader, Mark Richardson of Poplar Bluff, who successfully pressed for positive changes in the measure. At first the major argument was between the governor and majority Democrats, who favored defining the limit as a percentage of state revenue, and Republicans, who argued that the tax limit must be triggered by a flat dollar amount. The percentage-of-state-revenue approach suffers from the certainty of litigation over the definition of just exactly what constitutes state revenue. Are federal funds included? What about Medicaid and other federal reimbursements that come to the state for payment to hospitals and other health-care providers? Under the original Hancock amendment, passed by Missourians in 1980, such issues have been the subject of an endless procession of lawsuits. Missourians don't want more lawsuits. They want simple and effective tax limitation.

As the debate wore on in the House, Gov. Carnahan gave in on nearly every point. As finally approved by the House, any tax or fee increase or any combination of those that would be more than $50 million, or one percent of state revenue, whichever is less, would go to a vote of the people. As Rep. Richardson says: "One percent of state revenue is currently $52 million. What that means is that when lawmakers want to increase taxes and the tax increase would raise over $50 million, the voters would get to have final say on whether the tax will be increased. In addition, if an increase is enacted without a public vote but later increases revenue in excess of that limit, voters will receive a refund."The House-approved constitutional amendment would go to Missourians for a vote in November 1996. Senators should press for an earlier submission to the voters, possibly at the April election next year. If the tax-limit proposal is a good idea, why should Missourians have to wait 18 months to add it to our constitution.

Keeping faith with Missourians on tax limitation is of vital importance in restoring their trust in state government. The Senate should debate this measure, include an earlier voting date and send it to Missourians during this session of the legislature.