MGA Legislative Alert – Dentons Lobby Team Report – Week 15
2016 BUDGET AND SUPPLEMENTAL BUDGET SENT TO GOVERNOR
The 2016 state budget, HB 1 through 13, had been in conference for almost two weeks by the time the conference committee finally decided to convene and reveal its negotiations late Wednesday evening. On April 8th the two chambers had announced that they would conference to work out their differences on the thirteen budget bills, and listed which members from each chamber would be a part of those negotiations. Since then, several Conference Committee hearings were canceled as a compromise proved hard to reach. Some of the most contentious issues include Appropriations Chair, Kurt Schaefer’s lump-sum strategy to cut welfare spending in HB 10 (DMH and DHSS) and HB 11 (DSS) and language surrounding the payment of bonds by the Office of Administration in HB 5. The concern members from both parties had with the OA budget related to the Governor’s payment of bonds for the purpose of funding a new NFL stadium in St. Louis. Appropriations Vice Chair Senator Ryan Silvey led the debate, to include language prohibiting the Governor to pay bonds for this explicit purpose without a vote to the people or the legislature. On the opposite side of the issue were Speaker John Diehl, House Budget Chair Representative Flanigan, and Budget Vice Chair Representative Fitzpatrick. In the end, Silvey’s proposed language was not included. In HB 10 and 11, Schaefer’s lump-sum strategy was abandoned and the two bills were lined out as the House had originally proposed. However, this did not come without cost. The compromise lies in two new provisions: the expansion of managed care to TANF recipients and children, and keeping the proposed 4-6% overall cuts for the departments, both championed by Budget Chair Kurt Schaefer. By the early hours of Thursday morning, the Conference Committee Reports received the necessary amount of signatures to hit the House and Senate Floors Thursday morning. Both chambers then approved the Conference Committee Reports for the 2016 budget sending it to the Governor’s desk for signature.
This week the Senate Appropriations Committee unanimously voted HB 14 “Do Pass,” which appropriates supplemental funds for the state’s 2015 budget. While each year the legislature is required to draft and pass a state budget for the next fiscal year by early May, a supplemental budget is an opportunity to return to the previous budget and add any extra funds when necessary. HB 14 lists the additional funds necessary for the state of Missouri to function through December 2015. During the Appropriations committee’s Tuesday meeting no amendments were offered to change the line items proposed by the House. On Thursday, the Senate Third Read and voted on the supplemental budget. With a 33-1 vote, HB 14 was declared “Truly Agreed to and Finally Passed” and will hit Governor’s Nixon’s desk for an anticipated quick signature.
ST. LOUIS TAX POOLING CHANGE ADVANCES
There are several pieces of legislation this session that seek to alter the way municipalities in St. Louis county distribute their sales tax revenue. This week, a committee substitute was adopted on SB 221 that not only changed the way sales tax revenue is distributed, but would also allow the county to implement a law enforcement tax. Senator Schatz sponsors the bill, but the changes were made under the supervision of House handler Rep. Hinson. If implemented, this bill would let “B” cities keep at least half of the sales tax revenue they generate, but this could cause some cities to lose significant amounts of revenue. It is also estimated that the county government will lose around $800,000, but that could be made up with an additional law enforcement sales tax. The bill was Third Read and Passed out of the House this week and will now go to the Senate where they can accept the Committee changes, or more likely, go to conference committee to find a compromise.
MUNICIPAL COURT REFORM GETS BIPARTISAN SUPPORT
Municipal court reform received bipartisan support as the Committee Substitute passed out of the House on Wednesday. This legislation, sponsored by Senator Schmitt, is to prevent municipalities from abusing municipal courts as a revenue source. Currently, municipalities are allowed to derive 30% of their revenue from court fines and traffic violations. The legislation in its most current form would limit that to 15% in St. Louis County and 20% in the rest of the state. Originally, the bill dropped the threshold down to 10% and 20% for smaller counties, but it was amended in the House Committee. The bill has now been reported to the Senate and it will likely go to conference to find a compromise between the House and Senate versions.
RIDE SHARING REGULATIONS PASS OUT OF HOUSE
Ride sharing companies have gained traction in many cities, but regulations have been a major roadblock to their success. Another set of regulations for the transportation network companies passed out of the House this week in HB 781, sponsored by Rep Gosen. This bill adds specific regulations about how drivers in these companies must be vetted and regulations about insurance for the transportation network companies and their drivers. This legislation has been moving very slowly through the House, taking over two months to move from the Property, Casualty and Life Insurance Committee to the House floor. With only three weeks remaining in session, this legislation may not have moved quickly enough to successfully pass. Two other bills regulating Transportation Network Companies, HB 792 and SB 351, are waiting to be reported out of committee.
RESOLUTION TO LIMIT STATE SPENDING AMENDED IN SENATE
As state revenue has grown, so has the Missouri Budget. Republican legislators are seeking to manage budget expansion and save money for when the state is struggling financially. HJR 34, sponsored by Rep. Burlison, would limit the amount that the state budget is allowed to grow each year and require the remaining money to be put aside. This resolution was passed out of the Senate Rules, Joint Rules, Resolutions and Ethics Committee this week, and was also amended to require tax credits be subject to appropriations to regulate their impact on the budget each year. This goes hand in hand with the legislature’s trend towards trying to limit growth, and the Senate Appropriations Committee’s attempt to prevent growth of the Health and Mental Health budgets. The bill is now waiting to be heard in the Senate Governmental Accountability and Fiscal Oversight Committee.
BRINGING INTERNATIONAL TRADE TO MISSOURI
Representative Anne Zerr introduced HB 1122 to establish the Missouri Export Incentive Act. This incentivizes foreign trade through Missouri’s international airports by creating a tax credit. The Missouri Export Incentive Act, if enacted, would create an air export tax credit equal to 40 cents per chargeable kilo for shipment of cargo and/or passengers on aircraft that pass through Missouri airports. The amount of these tax credits available each year would be adjustable, dependent on the fluctuation of fuel costs from year to year. HB 1122 comes complete with a July 1st, 2015 start date, 2023 sunrise, application process to receive the tax credits and caps. A hearing for HB 1122 was conducted in the House committee on Economic Development and Business Attraction on Tuesday, but the Committee has yet to take a vote.