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Tax-Cut Plan Approved

May 09, 1996
By: Dana Coleman, Angie Gaddy, Elizabeth McKinley
State Capital Bureau

JEFFERSON CITY - If you're young and you don't have kids, you wouldn't get a thing from a proposal before the Senate to cut taxes by $150 million per year.

That's because a Senate committee endorsed Thursday giving private pensioners and people with dependents an income tax cut.

The Senate Corrections and General Laws Committee approved the income tax cuts as a substitute for the House-passed two-cent-per-dollar cut in the sales tax on groceries.

The House bill's sponsor, House Ways and Means Committee Chairman Ken Jacob, D-Columbia, immediately labeled the Senate's approach as unacceptable.

Jacob complained that those who need tax relief the most - the poor - would not benefit from an income tax reduction:

"Everybody needs to buy food, but there are people in this state who are so poor that they don't have to pay any income tax," Jacob said.

But Senate President Pro Tem Jim Mathewson said people raising a family are the ones he thought the state should help with tax relief.

"It doesn't cost as much for them (single people without children) to live as it does when your raising little kids and that's what I'm about."

Joining Mathewson, the Senate's top Democrat, in proposing the income tax reductions with the Senate's Republican Leader Franc Flotron, R-St. Louis.

Senate committee members pointed out several red-flag issues during Wednesday's hearing.

Sen. Danny Staples, D-Eminence, cautioned that although the state can afford a tax-cut right now, the future holds economic uncertainties. And if the money is needed in the future, "Nobody will have the courage to raise the sales tax again," he said.

"Government goes in peaks and valleys. Right now, we're in a peak. But in a couple of three years, we're going to be in a valley," Staples said.

The Senate's proposal to increase the dependent deduction from $400 to $1,200 over a three year period would not go into effect until January, 1997.

Tax-payers wouldn't actually save any money until April, 1998, when they file their 1997 taxes, said Mark Ward, state budget director.

Jacob argues that Missourians would start reaping the benefits of his food-tax cut this July while, according to the state budget office, taxpayers would not get the benefits of an income tax reduction until 1998.

Since the beginning of the session, legislators have been arguing over the best way to pare down state tax collections that are exceeding the state's revenue limit by more than $100 million per year.

The governor originally proposed an across-the-board sales tax cut that would have reduced state revenues by $140 million per year.

In other legislative action:

FLOODS:

* Just two days after approving stronger state regulation over development in flood plains, the House reversed itself and rejected the idea.

Opponents "gutted" the bill before taking a final vote. By the end of the debate, the bill would have merely established a flood plain data collection agency, said the bill's sponsor, Gary Wiggins, D-New Cambria.

The Missouri Levee and Drainage District Association played a strong role in the bill's defeat, Wiggins said. Members of the state-wide grassroots association, spent the last few days calling representatives, urging them to vote against the measure.

"We're opposed to restricting economic development in the flood plain," said Tom Waters, the association's secretary.

"Once the bill's passed, we don't know what kinds of rules and regulations they would write," said Waters.

The association's president Paul LePage, said he worked closely with the Missouri Farm Bureau to stop the legislation. "This bill would be creating a new level of bureaucracy," LePage said.

Supporters of flood-plain development restrictions argue that continued development in these areas makes flood-relief efforts more difficult and expensive -- even if the development was done against government recommendations.

As happened with the 1993 flood, government agencies ended up finding themselves fighting a loosing battle to protect the areas and, in the aftermath, providing recovery support in the very areas where development had been discouraged.

SAFE SCHOOLS:

After 37 amendments and hours of debate, the Senate passed the governor's proposal to keep disruptive students from bothering others in their classrooms, despite a plethora of amendments.

The measure now goes back to the House for review of the Senate changes.

The bill's sponsor expressed confidence the differences could be worked out before the May 17 adjournment - despite the long list of Senate amendments.

"I think the Senate changes have been improvements that don't change the content of the bill," said Steve McLuckie, D-Kansas City.

Among several provisions of the safe schools bill are measures mandating communication between the school and juvenile authorities, records following the student who transfers, state-wide expulsions and grant for alternative schools. Alternative schools are for students who do not function well in a traditional classroom.

BUDGET:

* The debate over state funding for abortion services has sent the Health Department's budget back to conference committee for ironing out the differences before today's deadline.

Earlier this week, the House threw the budget back into conference for a technical correction on funding for pregnancy health services.

Thursday, the version of the budget that came back not only fixed the mistake -- but also, according to critics, opened the door to state funding for Planned Parenthood.

"The will of the House is that Planned Parenthood should not receive state funding," said Assistant Minority Floor Leader Don Lograsso, R-Blue Springs.

"The votes are here to do as we will. It's the House and Senate versus the conferees. It's our intention to go to the wall on this."

So, budget conferees went back late Thursday to draft yet another plan for the $1.5 million budget item so the legislature could finish work on the $13.8 billion operating budget.

SPOUSE BEATERS:

A bill that would make court costs free for domestic violence victims is on its way to the governor. The House passed the bill that would allow victims prosecuting domestic violence cases to bypass court costs on Thursday.