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Dueling news conferences debate tax cut bill

Dueling news conferences debate tax cut bill

Nixon faces Thursday deadline for action

April 29th, 2014 in News

Gov. Jay Nixon must sign or veto a controversial tax cut bill by the end of the day Thursday.

And the bill's opponents and supporters both stepped up the pressure Monday to get the governor and lawmakers to see things their way.

The Coalition For Missouri's Future said lawmakers should forego any override attempt of the likely veto of the bill.

"We're estimating that state funding for our schools would be cut by about $223 million a year when the bill is fully implemented," said Brent Ghan, spokesman for the Missouri School Boards Association, one of more than 50 organizations in the CMF.

"And that's a best-case scenario, assuming a state revenue loss of between $620 million and $800 million a year."

Jefferson City School Board member and MSBA president-elect Doug Whitehead added: "In Jefferson City, the cut to our budget will be around $2.3 million, which will derail the budgeting and planning we've done effectively for over 20 years."

Meanwhile, the Missouri Chamber of Commerce and Industry, backed by Republican lawmakers, told a separate Monday morning news conference that Nixon just should sign the tax cut bill and not force a veto override.

"It's time to stop the rhetoric," President and CEO Dan Mehan of Jefferson City said. "Stop pitting business against education - that is a false key. We are not against education.

"This is about growing the economy."

Nixon said last week the bill "can not become law."

Senate leaders told reporters Monday night if Nixon vetoes the bill, they'll seek to override that veto the next day the Senate is in session.

State Sen. Eric Schmitt, R-Glendale, noted many lawmakers campaign on, and talk with voters, "about small business being the backbone of the economy. We talk about over 90 percent of the businesses out there being small businesses."

He acknowledged changing tax rates, especially for small businesses, has been "challenging to do - there's a reason why this hasn't happened in almost 100 years."

But, Rep. John Diehl, R-Town and Country, said 121,000 Missouri businesses would benefit from the tax cut.

"Over 85 percent of these businesses employ fewer than 20 people - approximately 99,000 businesses in Missouri," he said. "Collectively, these employers employ just under 400,000 workers, and provide an annual payroll of over $12 billion."

Requiring fewer taxes would allow those businesses to reinvest in their operations, get newer equipment and hire more people - all to the benefit of the whole state, the tax cut supporters said.

But, the opponents argued, there's no guarantee that cutting taxes improves the economy, while it's clear that cutting taxes reduces the state's income.

The proposed law "will negatively impact seniors by reducing critical services and, actually, costing them more in the long run," said Ron Sergent, an AARP volunteer and retired Columbia teacher. "Tens of thousands depend on services like home-delivered meals, caregiver supports and other home- and community-based services, in order to maintain their dignity and their independence.

"All of these, as well as crucial long-term services, would be placed at risk under the cuts required by Senate Bill 509."

Damage to an "already seriously underfunded" mental health system was called a virtual certainty by Cindi Keele, director of NAMI-Missouri - a volunteer group working with families dealing with mental illness. "During the current economic crisis, our state made some of the largest cuts to mental health services in the nation - that amounted to more than $100 million since 2009," she said.

However, Diehl said: "Without healthy businesses - without businesses that have favorable tax treatment - they don't employ as many people and then we don't have residents buying stuff in our stores, or paying property taxes on their houses."

Mehan, Diehl and Schmitt all said employees also get a tax break from the bill that will help the economy grow.

Whitehead and Ghan both said Missouri schools aren't against tax cuts - after the state has kept previous promises.

"We also have not had full funding of the foundation formula in recent years, which is something the Legislature promised in 2005, when they approved this formula," Ghan said.

Whitehead said lawmakers should fulfill the current legal obligation to fund the foundation formula.