MoDOT sales tax petition withdrawn

Supporters of a ballot initiative that would raise the state sales and use taxes to fund transportation projects have withdrawn their petition from the Secretary of State’s Office.

Missourians for Safe Transportation and New Jobs submitted a proposal last October to place an initiative increasing the sales and use taxes by 1 percent on the November ballot. The proposed 10-year tax increase would generate an estimated $800 million annually for the Missouri Department of Transportation.

According to the Missouri Chamber of Commerce, the group stopped gathering signatures several weeks ago, hoping to refocus its efforts on winning legislative support for the measure. The group would have needed to obtain at least 170,000 signatures by May 4 for the tax initiative to appear on the ballot.

Missourians for Safe Transportation and New Jobs is headed by Rudy Farber and former state senator Bill McKenna, both former members of the Missouri Highways and Transportation Commission.

The decision comes in light of a legal challenge from a nonprofit advocacy group over ballot language. Last November, the Missouri Association of Social Welfare filed a suit in Cole County Circuit Court on grounds that the language used in the petition is deceptive and misleading.

Among the association’s arguments are claims the petition’s summary statement incorrectly implies the sales and use taxes are a single tax and misstates the percentage by which the taxes would increase, according to court documents.

Jeanette Mott Oxford, the association’s executive director, said in an email the tax initiative withdrawal was a “big victory.” She said she believed supporters of the petition had crafted “confusing and erroneous” ballot language, responded confidently to the organization’s ensuing legal challenge and then backpedaled, claiming they wanted to retry the legislative route.

The organization does support investments in roads and public transit, Oxford said, but they should be accomplished through means such as a “better-designed” fuel tax and a revised individual income tax system. In particular, she said she endorsed legislation expected to be filed by Rep. Judy Morgan (D-Kansas City) that would update Missouri’s income tax brackets and create $1.5 billion in state revenue that could be partially allocated to transportation.

Carl Davis, a senior policy analyst at the Institute on Taxation and Economic Policy, said in an email that a 1-cent raise in both the gasoline and diesel tax would generate a combined $40 million for the state. But the rate increase would need to be much higher than that, he said — when the institute analyzed Missouri’s tax in 2011, it found the rate would need to be increased by 9.6 cents to return its purchasing power to 1996 levels.

“Given that a few years have passed since we did that analysis, the increase that’s needed today is likely even larger,” Davis said.

Legislators in both houses have introduced bills that would place the sales tax on the November ballot, with voter approval: House Joint Resolution 68, sponsored by Rep. Dave Hinson (R-St. Clair), and Senate Joint Resolution 48, sponsored by Sen. Mike Kehoe (R-Jefferson City). Last year’s version of the bill gained traction in both chambers of the General Assembly, but the Senate ultimately failed to approve the proposal by the end of the legislative session.

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