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Republicans look for revenue without tax increases

April 17, 2003
By: Megan McCloskey
State Capital Bureau

JEFFERSON CITY - The Missouri legislature's Republican leadership delivered a personal message to Gov. Bob Holden that lawmakers would not accept his tax-increase package.

Republican leaders say they told the governor earlier this week they will not consider tax increases large enough to require statewide voter approval.

Senate President Pro Tem Peter Kinder, R-Cape Girardeau, and House Speaker Catherine Hanaway, R-St. Louis County, met with Gov. Bob Holdon on Tuesday and told him that any tax increases that require voter approval are off the table, Kinder said.

The state's budget office has estimated that any package of tax and fee increases of $75 million or more would require statewide voter approval under the state constitution's tax limitations.

Without tax increases, cuts will go way too deep, Holden spokeswoman Mary Still said.

"We should give people the opportunity to decide," Still said.

In January, the governor proposed a package of tax increases exceeding $670 million.

Republicans say they have a plan to fill some of the gaps in the ever-widening budget deficit.

The Senate Appropriations Committee passed a budget on Thursday that cut $387 million from the governor's budget plan -- but requires $200 million from a revenue enhancement package Senate GOP leaders say they will unveil next week.

Republicans say most of that projected revenue would come from three sources.

One bill ends some corporate and individual tax exemptions and is estimated to bring in more than $100 million. The second proposal comes from State Treasurer Nancy Farmer, and it would take the money from abandoned bank accounts and turn it over to the state. Farmer estimates a revenue gain of $70 million.

The third bill would bring in an estimated $57 million by eliminating the daily loss limit for riverboat gambling, which is currently set at $500.

The riverboat gambling bill has been sponsored by Democratic Sen. Ken Jacob, the minority floor leader from Columbia, but has received little attention until now.

The idea, however, may face problems in the House.

Hanaway said there is not a lot of support in the House for removing gambling loss limits.

The Senate Appropriations Committee earmarked where the extra revenue-package funds would go -- mostly to local schools and higher education.

Democrats say the Republicans are working backwards. Jacob questioned the sense of passing a budget, then voting on revenue options later.

Sen. John Russell, R-Lebanon and chairman of the Senate Appropriations Committee, said even though they would rather have the revenue up front, "It's better to have some budget than no budget."

Because of the time constraints, he said, they can't wait for all revenue to be finalized before a budget is passed. Missouri law requires the budget to be passed by May 9.

The Senate is expected to begin debate on the budget on Tuesday.