Apr 5, 2018 – Weekly Capitol Update

HOUSE ENDORSES MAJOR TAX OVERHAUL, COST UNKNOWN

The House of Representatives on April 4 granted first-round approval to a sweeping overhaul of Missouri tax laws that could severely reduce state revenue collections at a time when the state is already grappling with budget cuts due to previous tax cuts the Republican-controlled legislature granted in recent years. A second vote is required to advance the measure to the Senate, which a week earlier gave preliminary passage to its own massive tax-cut measure.

The version of House Bill 2540 that was taken up for debate was estimated to cost the state as much as $800 million a year in lost general revenue. However, lawmakers adopted a dozen amendments that will have an unknown impact on its overall costs. An updated cost estimate must be prepared before the House takes final action on the bill.

In 2014, lawmakers enacted legislation to cut individual tax rate paid by most Missourians from 6 percent to 5.5 percent. The rate reduction is being phased in over several years, with the rate currently sitting at 5.9 percent. HB 2540 would extend the reduction to drop the income tax rate to a flat 5 percent. The bill also includes cuts to various other taxes while increasing others to make up some of the lost revenue.

 

SUPREME COURT AGAIN UPHOLDS BAN ON FELONS WITH GUNS

The Missouri Supreme Court on April 3 again ruled that a state law prohibiting all felons from possessing firearms passes constitutional muster. The case marks the fourth time in recent years that the state high court has upheld the felon-in-possession law despite a 2014 constitutional amendment that supporters had intended to strengthen gun rights in Missouri but that the court has repeatedly ruled merely restated pre-existing law and made no substantive changes.

Although the judges split 4-3 on the latest case, the outcome wasn’t as close as the vote total suggests. While the four-judge majority ruled that the felon-in-possession law is constitutional, the three dissenters did not argue that it is unconstitutional. Instead, the dissenters merely argued that, for procedural reasons, they didn’t think the court should have even taken the case.

The case, Jack Alpert v. State of Missouri, was brought by a man who pleaded guilty to two drug-related felonies in separate cases in the 1970s but who has since maintained a clean criminal record. The man had his federal gun right restored in 1983 and since 1986 had maintained a federal license to deal firearms. He was required to surrender that license after the General Assembly changed its felon-in-possession statute in 2008 to apply to all felons, not just violent felons.

 

INVESTIGATIVE REPORT ON GREITENS EXPECTED SOON

The House committee investigating allegations of wrongdoing by Republican Gov. Eric Greitens is expected to release its report sometime in the coming days. The committee chairman had previously said the report would be made public on April 9, but on April 5 Republican leaders said the release would be delayed a few days.

When the House voted to authorize the Special Investigative Committee on Oversight (SICO) on March 1, Republican leaders stressed that its mission was to gather facts, not to determine if impeachment is warranted. However, the SICO report could serve as the basis for the House to pursue some type of action against Greitens if lawmakers deem it appropriate.

A St. Louis grand jury indicted Greitens with a felony charge of first degree invasion of privacy relating to a semi-nude photo he allegedly took of his former mistress without her permission in 2015. A judge has ruled against Greitens’ motion to dismiss the charge for lack of evidence, and the case is scheduled to go to trial May 14.

In a letter dated March 26, Greitens’ attorneys asked the committee to delay releasing any findings to the public until after the criminal trial is over to avoid swaying the opinion of potential jurors. The letter was signed by Greitens’ criminal defense attorney, his taxpayer-funded counsel in the governor’s office and an outside attorney who specializes in impeachment proceedings and who is also being paid by Missouri taxpayers.

However, SICO Chairman Jay Barnes, R-Jefferson City, said the committee will proceed as planned with making its findings public soon. Many Capitol observers questioned Greitens’ consistency in claiming to want to avoid influencing the jury pool since his campaign recently spent $50,000 on radio ads in the St. Louis attacking the prosecution as politically motivated.

In addition to matters related to the criminal indictment, SICO, which consists of five Republicans and two Democrats, also investigated whether Greitens may have illegally obtained the donor list from the charity he founded and improperly used it to raise money for his gubernatorial campaign.

If the House were to pursue impeachment, it is uncertain if the process could be completed before the legislative session ends on May 18. If the House passed articles of impeachment, the Senate would then be charged with electing a “special commission of seven eminent jurists” to try the case.

Only the legislature’s role in the process would need to be done before the session ends, as the trial could take place after lawmakers adjourn. If the legislature isn’t done, however, it likely would have to wait until the next regular legislative session begins in January to continue pursuing the matter.

 

REVENUE COLLECTIONS UP 3.8 PERCENT SO FAR IN FY 2018

Year-to-date net state general revenue collections increased 3.8 percent through the first nine months of the 2018 fiscal year compared to the same period in FY 2017, going from $6.47 billion last year to $6.72 billion this year. Net collections had been up 4.4 percent through the first eight months of FY 2018.

Net general revenue collections for March 2018 decreased 0.9 percent compared to March 2017, going from $7.55.6 million last year to $749 million this year.