The Cauthorn Report
JEFFERSON CITY, MO - Legislation drafted and advanced by Senator John Cauthorn promoting agribusiness cleared the House this week. SB 84 allows "new-generation" co-op owners and ethanol producers to take advantage of an existing tax credit incentive plan on a quarterly, rather than annual, basis.
"The money paid out in this modest tax credit program comes back many times over through expanded agribusiness production and markets, giving an enormous boost to Missouri's economy," Cauthorn said. "What this bill does is match credit cycles with quarterly estimated tax payments to help build positive cash flow."
Cauthorn reports that, facing one of the most difficult legislative challenges in 50 years, the Missouri General Assembly this week approved an $18.9 billion state budget funding essential services and programs.
"Completed ahead of schedule, the Legislature's budget balances without employing a statewide tax increase," Cauthorn said.
Coming in at approximately $50 million higher than the 2003 budget, the FY '04 budget (beginning July 1) includes a total of $4.478 billion for Elementary and Secondary Education, $1.013 billion for Higher Education and $5.516 billion for Social Services.
Other areas include $273 million for economic development, $14 million for the Department of Insurance, $152 million for the Department of Labor, $349 million for the Department of Public Safety, and $574 million for the Department of Corrections.
The Department of Mental Health will receive $929 million, the Department of Health and Senior Services will receive $451 million and statewide elected officials will get $84 million. The Judiciary will receive $160 million, Public Defenders will get $29 million and the General Assembly $31 million.
Despite revenue declines, Cauthorn and his fellow lawmakers managed to maintain a wide range of key programs including:
Missouri's annual budget process begins early in each legislative session and typically consumes the most collective time and effort from state lawmakers. The task is made more difficult during a contracted economy, something Missouri has experienced for the past three years. Shrinking revenues and rising costs create budget deficits, like the $700 million-plus shortfall projected for 2004 fiscal year, which begins in July. Missouri's constitution prohibits deficit spending, an added facet in the budget challenge.
The governor presented his budget plan a $19.3 billion package relying on nearly $750 million in new revenue in his January address to the General Assembly. Following tradition, the House next developed a budget plan. At $18.6 billion, the House package relied on no new taxes and substantial cuts.
"Breaking from tradition," Cauthorn notes, "the House plan used lump-sum, department-level appropriations, rather than the customary line-item approach an action that would have reduced control over the spending of taxpayers' money."
Having received and reviewed the House plan in April, the Senate Missouri's more deliberative legislative body drafted two line-item style budgets. The first version balanced on anticipated revenue under the current tax structure. The second added potential revenue gleaned from cost-savings and tax changes that lawmakers may agree to before the year's regular legislative session ends.
All bills must earn approval in both legislative chambers in order to become law. This in mind, and Senate and House committee conferees met throughout much of last week and this week ironing out differences in the budget bill series.
"Delegates from both chambers largely agreed that cuts, in some fashion and magnitude, were necessary," Cauthorn said. "Working together across party lines, lawmakers passed the last of the core budget bills nearly a day ahead of a constitutional deadline."
The Legislature's plan balances the budget primarily by tightening government spending in numerous areas. Cauthorn said that among a number of cost-saving provisions stemming from the conference committee, the negotiated plan delays opening of the new state prison in Jefferson City, closes the state's Washington, D.C., lobbying office, cuts the Missouri Lottery's advertising budget by half and eliminates funding for the presidential primary.
"To find $700 million, you've got to start by looking for a dollar," Cauthorn said. "Every little bit adds up." Cauthorn said that, while the Senate votes on the budget bills were not unanimous, the package earned solid bipartisan support from a significant majority who felt that the budget is based on real revenues, while meeting the program and service needs of citizens all without using a major tax increase proposal.
Conference committee delegates from the Senate and House are also negotiating a final version of a measure designed to increase oversight of, and generate further accountability within the state's transportation department. Drafted largely on Senate legislation, Cauthorn said HB 668 enables the Legislature's Joint Committee on Transportation Oversight to hire a director to perform specific investigations, reviews and audits within MoDOT. The joint committee's director would issue detailed summaries of complaints received by MoDOT and an annual performance review of the department.
Conferees are set to work on a measure revising state election laws to comply with the Help America Vote Act of 2002. Among several provisions, HB 511 creates a statewide pool for election judges, creates a computerized statewide voter registration list and establishes a toll-free number and/or internet website for provisional voters.
"Voting is a keystone to democracy and should be made as easy and accessible as possible," Cauthorn said.
Cauthorn and his Senate colleagues this week sent the House legislation expanding prescription drug access for seniors. Senate Bill 307 adds an incentive for drug makers to keep generic drugs in the plan. Currently, participating drug companies give a 15 percent discount on all prescriptions sold. Cauthorn explained that the Senate's legislation would allow drug companies to pay a lower, 11 percent, rebate on generic prescription drugs.
The Senate sent an early retirement incentive for state workers to the House. SB 248 would allow certain retirement-eligible workers to pay the same rates for medical coverage once retired. Typically, health plan premiums are higher for retired state workers than for active employees. Even though health costs would rise, the incentive plan, applicable to some 5,000 employees, is expected to generate up to $6 million over the first three years in payroll savings.
Cauthorn's Senate Governmental Oversight and Fiscal Oversight Committee this week approved a measure prohibiting unsolicited commercial e-mail, or "spam." HB 228 allows the state's attorney general to develop a list of e-mail addresses that would be off limits to most commercial entreaties, much like Missouri's "No Call" list wards off unsolicited commercial telemarketers.
"We're saying, 'keep your email promotional offers to yourself if we want a sales pitch, we'll ask for one,'" Cauthorn said.
The committee action sends the bill to the full Senate.
As the May 16 close to the year's regular legislative session rapidly approaches, Cauthorn remained cautiously optimistic about completing all of the people's business on time.
"That's what people send us here for - to get things done and done on time," Cauthorn said. "I've heard talk of a special session, but frankly, so long as rationality and reason prevail in the House and governor's office as they have in the Senate, all will be complete and correct when the final gavel drops."