Missouri Gov. Eric Greitens used his State of the State address Wednesday to announce a proposal to cut state taxes this year, even as the state budget is still adjusting to earlier state and federal tax cuts that are just now going into effect.
“Early next week, my team and I will lay out a detailed, thoughtful, and thorough plan to cut taxes on the hardest-working families in our state,” the governor said in a speech before a joint session of the General Assembly. “It is the boldest state tax reform in America.”
If lawmakers agree, he went on, “we will lower taxes for working families and make it easier for businesses to come to Missouri and create jobs. And we will do it in a way that is fiscally sound, maintains our state’s triple-A credit rating, and does not burden our children with debt.”
Greitens provided no additional details. But his proposal comes as the current budget may need adjustments to handle at least $150 million in projected lower state income, as a result of the federal tax cuts that Congress approved a few weeks ago.
Missouri’s general-revenue budget also is affected by a multi-year phase-in of income tax cuts approved in 2014. Those tax reductions are still underway.
Greitens and legislative leaders reached an agreement this week that state general-revenue income will likely increase by only 2.5 percent during the fiscal year that begins July 1. It does not appear that the projection takes into account the governor’s proposed new tax cuts.
In that same announcement, the governor and lawmakers disclosed that the state’s general-revenue income for the current fiscal year will be $150 million lower than projected. A spokeswoman for Budget Director Dan Haug said the loss was due, at least in part, to the federal tax cuts.
For the second year in a row, Greitens broke with gubernatorial tradition by not using the State of the State address to lay out his proposed budget for the next fiscal year. He said he will present his budget proposal at the same time that he lays out his tax-cut plan.
State House Assistant Minority Leader Gina Mitten, a Democrat from Richmond Heights, complained after the speech, "By failing to tell Missourians how he plans to spends billions of dollars of their money, Eric Greitens engaged in an empty rhetorical exercise instead of establishing a vision for Missouri in the coming year. Until we know how the governor plans to pay for public schools, repairing our crumbling roads and bridges and caring for the elderly and disabled, Missourians can only guess at his real priorities.”
But Dan Mehan, chief executive of the Missouri Chamber of Commerce, lauded the governor’s focus on taxes: “Missouri’s inconsistent tax structure has been a frustrating impediment to business growth for far too long. On behalf of our state’s business community, I would like to thank Gov. Greitens for making tax reform a priority. We will work with the General Assembly to advocate for this becoming a reality in 2018.”
The General Assembly, made up largely of fellow Republicans, applauded enthusiastically for many of the governor's proposals. However, the reaction was markedly muted when Greitens renewed his call for a ban on gifts from lobbyists. A similar bill passed the House last year, but died in the state Senate.
Highlights cuts in regulations, spending
Greitens began his speech by highlighting one of Missouri’s most famous African-Americans, George Washington Carver, who died 75 years ago this month.
Carver was born a slave, but rose to become a famous scientist and agricultural expert. “He was, and he remains, one of us: a Missourian,” Greitens said. “His story is our story.”
“We should remember where he started and how far he went,” the governor said. “We Missourians know that the contributions that have counted most have often come from people who were, at one time, counted out.”
The governor’s point? “I was sent here, and I believe that many of you were sent here, not to work for the connected or the comfortable, but for those who have felt counted out and forgotten. They are strong and proud, and while they may not have pull or power or privilege, they do have enormous potential.
“To those Missourians, I have a simple message: We have been and we will fight for you every single day,” Greitens said.
As proof, Greitens pointed to the statistics that illustrate the state’s standing. “Today, Missouri has the lowest unemployment rate it’s had in 17 years. Since last March, we have outpaced the nation in job growth, and in the past year, Missouri moved up nine spots in the rankings of the best states in the country to do business,” he said.
“There are more manufacturing jobs in our state than there were a year ago. We’re putting a steel mill in Sedalia, Missouri, and we are competing for more steel mills and other plants around the state. “
Greitens said such facts illustrated that “there are more jobs in Missouri than ever before, people are going back to work, and we are moving Missouri in a new and better direction. “
He reaffirmed his commitment to reduce state regulations, along with curbs in state spending.
“By taking a strong, thoughtful, conservative approach to government, we can tell you tonight that we are taking nearly one out of every three regulatory requirements in the state of Missouri — that’s 33,000 regulatory requirements — off the books for good,” the governor said.
“Missouri has become a leader. In fact, other states have modeled their regulatory reforms on what we are doing to increase liberty and prosperity in the state of Missouri.”
Highlighted foster care
Amid his focus on fiscal issues, Greitens emphasized his continued quest to improve the state’s foster-care system, which also has been a key focus of his wife, Sheena Greitens.
The governor noted that the state has 13,000 foster children. He said his staff is developing 20 legislative proposals that Greitens believes would improve the program. Some would help “get children into safe, stable, and loving homes faster. Another would help foster children get access to bank accounts, so they can save their money.”
“Every child in the Missouri foster care system has seen more than their fair share of hardship,” Greitens said. “We need to see in them their God-given potential, and we need to do everything in our power to help them to fulfill it.”
The governor also called for most legislation to help military veterans and police officers.
“One issue I want to raise tonight is the harassment of police officers,” the governor said. “Today, in Missouri, radicals can file liens against a police officer’s house. They can do this in secret, and it can affect the credit of our police officers and their families, costing them thousands of dollars. It’s harassment, and it needs to stop.”
Missouri Democrats attack governor’s ethics
House Minority Leader Gail McCann Beatty used the pre-recorded Democratic response to focus on other issues that Greitens did not mention in his address. In particular, she attacked what she called the governor’s “aversion to transparency and accountability.”
“Governor Greitens markets himself as a political outsider dedicated to cleaning up state government, said Beatty, a Kansas City Democrat. But she contended that his first year in office has “been stained by ethical failings,’’ including his office’s use of a special electronic application that erases text messages soon after they are read.
Attorney General Josh Hawley, a Republican running for the U.S. Senate, is looking into whether state-government texts must be retained under the state’s record-preservation laws.
Beatty also took aim at Greitens’ use of a political nonprofit, called A New Missouri, that can collect contributions of any size from any source. The donors and the spending do not have to be disclosed.
“The power of Missouri government is supposed to belong to the people, not to those that write big checks,” Beatty said. “Restoring power to the people of Missouri will require ending business as usual in Jefferson City.”
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