Jan 19, 2017 – Weekly Capitol Update

GOVERNOR PUNTS ON BUDGET DURING STATE OF THE STATE

In his first State of the State address, Republican Gov. Eric Greitens on Jan. 17 announced several costly new initiatives but no plan to pay for them, breaking with generations to past practice by failing to simultaneously present a proposed state operating budget for the upcoming fiscal year.

Due in large part to multiple and costly special interest tax breaks enacted by the Republican-controlled General Assembly in recent years, Missouri is facing a $456 million revenue shortfall for the 2018 fiscal year, which begins July 1. In his speech, Greitens denounced such giveaways, saying they have resulted in “a tax structure that is complex, corrupt and high,” and promised changes.

However, he didn’t mention his plan for dealing with the looming and massive budget hole and what spending cuts might be necessary to fill it. Until now, no Missouri governor in memory, if ever, has failed to present his budget during the State of the State. According to news reports, Greitens intends to finally submit a proposed budget sometime in February.

Some of the proposals in the Greitens agenda that will carry a substantial, though as yet undisclosed costs, including tax vouchers for private school tuition, adjusting income thresholds for some state programs so that a small pay raise at work doesn’t cost people their benefits and improving training and equipment for police officers.

 

GREITENS HITS EDUCATION WITH MID-YEAR BUDGET CUTS

Gov. Eric Greitens on Jan. 16 made $146.4 million in unilateral state budget withholdings, with more than three-fifths of the cuts targeting education spending and colleges and universities taking an especially hard hit. Greitens made the cuts to the state budget for fiscal year 2017, which ends June 30.

Of Greitens’ cuts, $90.3 million came from education appropriations, with $79 million of that coming from the Missouri Department of Higher Education. The higher education cuts included $55.9 million from the operating budgets of public four-year institutions and $11.8 million from community colleges.

The Missouri Department of Elementary and Secondary Education took an $11.3 million hit, most of which came from an $8 million cut to state funding for local school districts’ student transportation costs. Those costs will be shifted to local taxpayers.

The cuts were necessary because Greitens’ fellow Republicans, who control the General Assembly, passed an unbalanced FY 2017 state budget and then compounded the problem by enacting special interest tax breaks that weren’t accounted for in the spending plan. Greitens’ cuts came in addition to the roughly $200 million in FY 2017 withholdings his predecessor, Democratic Gov. Jay Nixon made before leaving office earlier this month. Nixon had minimized the impact on education with his budget actions.

 

SUPREME COURT SAY WAGE HIKE MUST GO ON KC BALLOT

Kansas City voters could soon decide whether the city’s minimum wage should be boosted to $15 an hour after the Missouri Supreme Court on Jan. 17 said city officials wrongly kept it off the November 2015 ballot. If voters approve the wage hike, however, it is uncertain if it will take effect due to a state law that prohibits local minimum wages that are higher than the state wage floor, which currently stands at $7.70 an hour.

After wage-hike supporters in 2015 submitted an initiative petition to the Kansas City Council proposing a local ordinance imposing a $15 citywide minimum wage, the council placed the measure on fall ballot. Two months before the election, however, the city went to court to block the vote, citing a then-new state law that took effect in August 2015 pre-empting local minimum wages.

In its unanimous ruling, the Supreme Court followed its long-standing precedent limiting pre-election legal challenges to determining whether a proposal followed the proper legal procedures to get on the ballot. Under that precedent, challenges concerning whether a ballot measure passes legal or constitutional muster only become ripe if voters approve it.

Since city officials don’t dispute that the minimum wage initiative followed proper procedures, the high court ruled they had no grounds to keep it off the ballot. The court ordered the city to “take all necessary steps” to put the proposal on the city ballot but set no firm election date.

If Kansas City voters ultimately approve the $15 minimum wage and opponents sue to block it, wage hike supporters are expected to argue that state pre-emption law itself is unconstitutional on the grounds that the Republican-controlled General Assembly violated constitutional procedures in enacting it.

 

RIGHT-TO-WORK BILL CLEARS HOUSE, HEADS TO SENATE

The Republican-controlled House of Representatives on Jan. 19 voted 100-59 in favor of controversial legislation that would make it a crime punishable by jail time for business owners to negotiate labor contracts that require workers to pay dues for the union representation they receive. The measure now heads to the Senate for further debate.

House Democrats sought to include a provision putting the measure, House Bill 91, on the statewide ballot, but majority Republicans rejected the effort due to concerns that voters might reject the legislation, dubbed “right-to-work” by supporters.

 

HOUSE SENDS LIMITS ON LOBBYIST GIFTS TO SENATE

With strong bipartisan support, the House of Representatives on Jan. 17 voted 149-5-2 in favor of legislation that would place new restrictions on gifts from lobbyists to elected officials. Under existing law, state officials can accept unlimited gifts — such as free meals, concert or sports tickets and other items – from lobbyists.

While the Republican sponsor of House Bill 60 touted it as “banning” lobbyist gifts, the legislation includes a number of loopholes that will allow lawmakers to continue to except gifts in some circumstances. House Democrats attempted to close some of those loopholes, but were rebuffed by Republicans.

However, Democrats nonetheless supported the bill as a significant improvement over existing law. HB 60 now heads to the Senate, which in recent years has been resistant to restricting lobbyist gifts.