Senators redirect Missouri gambling funds to schools

Thursday, March 26, 2009 | 5:10 p.m. CDT; updated 6:23 p.m. CDT, Thursday, March 26, 2009

JEFFERSON CITY — Missouri senators voted to alter a voter-approved casino initiative by changing how the new tax revenues are distributed to public schools.

Senators gave first-round approval to the change early Thursday as part of a wide-ranging education bill after roughly an eight-hour debate.

The bill also includes provisions creating a method for distributing federal stimulus money for school construction, implementing a version of merit pay for St. Louis teachers and studying whether to let students choose which school district they want to attend.

The legislation needs another Senate vote to advance to the House.

Last year's casino ballot measure removed Missouri's unique gamblers' loss limits and increased taxes on casinos. Revenue raised from the initiative was intended as new money for schools.

But because of the way Missouri distributes education funds, 115 of the state's 524 school districts are projected to get no additional money next year from the ballot measure.

Republican Senate President Pro Tem Charlie Shields said the authors "really didn't understand exactly how the formula works." He said legislators had to tweak the law so all schools benefit.

The Missouri Gaming Commission has estimated the new law could generate between $75 million and $125 million annually.

The change endorsed by the Senate directs the new gambling money to a state fund that already receives other casino tax revenues.

The bill would remove a cap on how much the education funding formula can grow each year, which is expected to result in a $40 million increase for K-12 public schools.

Schools also would receive a boost for educating gifted students. Originally pegged at $10 million, education officials now estimate that provision could direct up to $50 million to schools.

The higher cost estimate caused senators to reconsider how many students a school district could consider gifted, though lawmakers said they would make changes as the bill moved through the process.

The bill's potential $90 million price might exhaust the new casino revenues.

"That's a little on the high side," said Sen. Rob Mayer, R-Dexter.

MU political science professor Peverill Squire said he isn't surprised lawmakers are changing the new law so soon after the election. Many voter petitions, he said, leave lawmakers and courts in a bind because they're drafted poorly.

Additionally, he said, "legislatures don't particularly like to be constrained in what they do."

The bill also creates a potential method to use federal stimulus funds for school construction or repair. A new fund would distribute construction money to districts based on their average daily attendance.

Shields said he hopes to put roughly $500 million from the stimulus package into the fund, though he estimated that Missouri schools have roughly $4 billion in infrastructure needs.

Another provision creates a version of merit pay for teachers in St. Louis. Under the plan, teachers could decide whether to participate in a system in which they could earn up to $15,000 in additional pay based on criteria such as student test scores or parent evaluations.

Teachers who choose the plan would have to give up tenure.

Sen. Jeff Smith, D-St. Louis, said similar ideas have helped improve other urban school districts. He said he is willing to try almost any new idea to turn St. Louis Public Schools around.

Critics said the merit-pay proposal would add another burden on the struggling district.

The bill also would require lawmakers to study whether to let families choose the district they want their children to attend, rather than having students attend schools in the district where they live.

Proponents say the idea could create a more competitive school system, but critics worry about tax revenue being shifted out of urban districts.

Under the bill, the Joint Committee on Education would study the issue and produce a report by Dec. 31.

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