Missouri Attorney General Chris Koster is proposing that the state’s voters be asked once again to increase the state’s tobacco tax, now among the nation’s lowest.
But instead of previous failed proposals that would have directed the bulk of the money raised for health care programs, Koster would use the estimated $400 million a year primarily to pay for state incentives to improve the business climate and attract more jobs.
Among other things, Koster proposes that some of those incentives be directed to encourage business to locate in low-income areas, such as north St. Louis County, where he argued that the lack of jobs is feeding the frustration that erupted with the police shooting in Ferguson.
“Part of economic development is learning the lessons of Ferguson and acting upon them,” he said.
Koster – a Democratic candidate for governor in 2016 -- laid out his plans in a detailed address Thursday before the St. Louis Regional Chamber that was arguably his most specific to date on an array of policy issues.
Among his key points:
- Legislators should shy away from any future tax cuts until they see the fallout from the most recent tax-cut plan that goes into effect in 2017. Koster pointed to Kansas’ economic troubles since it dramatically slashed taxes too much.
- More state money needed to be directed toward higher education, which he said has been shortchanged for almost 15 years.
- Attracting “the best and brightest’’ means the state needs to become more inclusive when it comes to race, gender, immigrants and sexual orientation.
Koster also defended his integrity, and his campaign money-raising, as he addressed questions about a recent New York Times story that implied that he and other state attorneys general were the subject of undue influence by corporations and their lobbyists.
In an interview after his speech, Koster called for more “transparency’’ in Missouri’s campaign-finance laws, and a ban on all lobbyist gifts to public officials and legislators.
Addressing Ferguson’s issues
Koster confirmed that he, U.S. Sen. Claire McCaskill and St. Louis Mayor Francis Slay were among those involved in discussing how best to address the tensions that erupted since the Aug.9 police shooting that killed unarmed teenager Michael Brown.
The attorney general said he has “been frustrated for 90 days that there has not been a dialogue track opened up in Ferguson that I have felt was satisfactory.”
He gave particular praise to Slay chief of staff Jeff Rainford, St. Louis Police Chief Sam Dotson and St. Louis County Police Chief Jon Belmar.
“We are working hard to recognize that no matter what happens with the grand jury, that the cause that created the frustration is something that all communities need to acknowledge and listen to, and improve upon,” Koster said.
Their plan in the coming weeks, he said, is to “try to offer the beginnings of solutions for a better path forward.”
Blasts decline in state education spending
But the guts of his proposals focused on education and economics – two areas where Koster argued that Missouri is losing ground with many other states.
He asserted that the two issues also were related.
“I want to believe that our values in this state are bigger than just low taxes and light regulation,” Koster said. “That it includes K-12 education, higher education, a minimally successful social-safety net, roads, quality of life.”
For example: He proposed to earmark about $60 million of the additional tobacco-tax money to beef up state spending on education, particularly higher education.
Koster contends that state spending for colleges and universities has been roughly stagnant for 14 years, and now amounts to less than a third of the income that the institutions need each year.
“It is no longer ‘state-funded’ higher education in Missouri, it’s ‘state assisted,’ ’’ Koster said. Too much of the extra money needed, he added, is “being filled on the shoulders of 19-year-olds.”
Missouri voters rejected proposed hikes in the state's tobacco taxes in 2002, 2006 and 2012. But Koster said he was confident that voters would embrace a hike if they backed the proposed uses for the money.
Koster recalled that previous proposals had called for using at least $100 million in the new tax income for "smoking cessation programs."
"We don’t live in a world where we can afford $100 million for smoke cessation," he said.
Calls for new approach in wooing jobs
Koster cited a series of Missouri’s economic ratings from national business groups or news outlets that generally put the state in the middle of the nation’s 50 states.
One survey recently placed Missouri as 45th when it comes to recent job growth.
He called for the state to work to get into the national Top 10 when it comes to attracting businesses and job. But Koster then asserted that Missouri now lags behind other states because legislators have taken the wrong approach.
He acknowledged that he had supported the recent tax cuts approved last session by the General Assembly, but added that to do any more slashing in the short-term would be “unwise.”
“Right now in Jefferson City, we just ‘shoot in the dark’ to be honest with you,” he said. “We cut taxes a couple months ago. We’ll get back in January. We’ll look around. We’re not No. 1, so we’ll simply cut taxes again. That’s not a systematic look at what it takes to move up these objective rankings.”
Corporate influence and campaign finance
During the question-answer session with business leaders, and later with reporters, Koster denied that his successful campaign fundraising affected how he ran his office.
Using the drugmaker Pfizer as an example, Koster said that he had sued the firm at least six times and obtained $25.8 million for the state’s coffers.
“I have sued Pfizer more times than I have sued any business in America,” he said.
As for the $20,000 in campaign donations that Koster had collected from the firm, he said that was the tally for six years worth of contributions. Koster emphasized that none of the donations came in the midst of litigation.
He made no apologies for speaking at a Pfizer conference, and said that was no different from his frequent appearances before other groups, including teachers associations.
But as for the broader issue of campaign finance, Koster said, “I’m a believer of transparency.”
He acknowledged that he’s no fan of campaign-donation limits, saying that such restrictions simply force money to be distributed through other less transparent ways.
Koster singled out, for example, the growth of political groups forming 501C4 non-profits, so that they don’t have to disclose their donors.
He suggested a change in Missouri law so that 501C4s planning to participate in campaigns would be required to file with the Missouri Ethics Commission and “disclose all donors for the last four years.”
Koster also proposed that such groups be required to list their top four donors in every ad aired in the state.
In other measures, he called for tightening the state’s campaign-finance disclosures so that candidates would be required to report all donations greater than $2,500 within 48 hours – such reporting is now mandated for contributions greater than $5,000.
As for barring all lobbyist gifts, Koster observed that he didn’t believe that legislators could be influenced by a dinner. But he added that even free food looked bad to the public.