GUEST COMMENTARY: HB 253 veto should stand

Saturday, August 24, 2013 | 6:00 a.m. CDT; updated 12:42 p.m. CDT, Tuesday, August 27, 2013

During the 2013 session, the legislature passed House Bill 253, a sloppily drafted bill that will cost the state more than $800 million per year when fully implemented. The Governor, believing that HB 253 will decimate essential state services, endanger our AAA credit rating, and unnecessarily raise taxes on the elderly, rightly vetoed the bill, but legislative leaders plan to attempt to override his veto in September.

Beyond its devastating ramifications for critical state services upon which all Missourians rely, HB 253 is rife with problems ranging from increased taxes on seniors to a retroactive tax cut that would create a tremendous blow to the state budget. These problems result either from sloppiness or bad policy ideas; either way, given the bill’s negative impacts, I urge my colleagues to let the veto stand.

In what is said to have been the result of a drafting error, HB 253 would impose the state sales tax on prescription medicine and textbooks. While the thousands of mid-Missourians whose income is primarily comprised of pensions from the state, the university, teacher retirement or Social Security will not see any benefit from tax cuts; they will pay more for prescription medicine. To see what this might mean for my constituents, I asked my pharmacist to calculate how much more I would pay for the medicine I now take as a result of a recent minor heart attack. She tells me my annual bill would be about $140 higher. While the size of this tax increase will vary among people, the bottom line is that HB 253 is a significant — and unnecessary — tax increase for many older Missourians.

Besides its inadvertent tax increases, HB 253 puts vital state services at risk through its tax cuts. In addition to cuts to individual and corporate income tax rates, the bill also exempts half of all business income from taxation. Though proponents maintain that cuts would only occur if state revenue targets are met, this so-called “trigger” does not apply to its business income provisions, which are the most costly provisions of the bill. As a result, the “trigger” is essentially meaningless at preventing enormous cuts to critical state services.

Another troubling aspect of the bill is the extent to which future income tax rate cuts apply retroactively. Though tax bills normally are clear regarding when various tax rates apply, HB 253 is ambiguous with respect to the impact of tax rate reductions resulting from federal action on the Marketplace Fairness Act (Internet Sales Tax). A fundamental principle of Missouri’s law on retroactive taxes is that any ambiguity with regard to taxes is to be construed against the government and in favor of the taxpayer (See Hess v. Chase Manhattan Bank, USA, N.A., 220 S.W.3d 758, 769 and Savannah R-III School Dist. v. Public School Retirement System of Mo., 950 S.W.2d 854, 858). Given precedent, I think it is clear that when the federal Marketplace Fairness Act goes into law, the state will experience a $1.2 billion blow to its budget. But even for those who disagree, the ambiguity principle certainly still applies; and it is undeniable that a $1.2 billion unresolved question makes for bad tax policy.

The reasons for the veto to stand are many. The sloppiness of HB 253 alone warrants opposition. Careless policymaking created a $1.2 billion discrepancy that was never addressed or even considered. The new sales taxes on prescription drugs and textbooks were “mistakes” that will result in a $300 million tax increase that was never debated.

Politicians are fond of saying that government should behave more like business. The sponsors should thank their lucky stars that it does not; we all know what would happen to employees in the private sector who made a multi-million dollar error in tax planning — they would be fired on the spot.

No rational legislator should consider voting to override a veto on a bill that is this badly written. The legislature should be ashamed of itself for considering it.

Finally, HB 253 is a textbook example of the abuse of money in the political process.  Although the bill will financially harm state employees, the elderly, college students, our public schools and universities, the mentally ill and Missouri public safety; it will help a few very high-end taxpayers a great deal. Rex Sinquefield, one extremely wealthy Missouri taxpayer, has poured more than two million dollars into the political coffers of the bill’s supporters. We will never see a better example of the corrosive effect of big money on our political system.

Because of its negative effect upon state services, because of its negative effect on senior citizens, because it is so sloppy and because it is a classic example of financial corruption in politics, the legislature should sustain Governor Nixon’s veto.

Chris Kelly represents District 24, which includes Columbia, in the Missouri House of Representatives.

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Michael Williams August 24, 2013 | 8:13 a.m.

Chris: You've made much hay in this article about the prescription tax error inadvertently left in the bill. And, I agree it was an error.

Is this the first time this has happened? Are you (i.e., the legislature) unable or unwilling to fix this part of the law? Is there a consensus for fixing, or not fixing, the problem if a veto override occurs? If this type of thing has happened before, can you name examples so we can see how past democrat/republican legislatures responded to unintended consequences?

I confess I'm asking these things because I wonder if you are being alarmist in a situation where everyone already knows there is a problem and everyone is willing to quickly fix it....which means this issue is not an issue at all, except one of political pandering and using a false argument.

I can be convinced otherwise, but you (or someone else) will have to Show Me.

(Report Comment)
Chris Kelly August 24, 2013 | 8:34 a.m.

Michael, The increases in the tax on prescription medicine and on textbooks were not in the original versions of any of the bills. Nor was the ambiguity regarding whether the bill would be retroactive. The sponsors say hey were all added inadvertently and tried to blame Nixon. That is like saying "Nixon's dog ate my homework." What that means is that more than 100 Republicans in the House and 20 in the Senate voted for a bill with between $300 million and 1.2 billion worth of mistakes. It means that the sponsors did not know what was in their bill and not one of the supporters read it; not one. That is amazingly irresponsible.

As to whether it can get fixed; if course it can. But you must assume that somehow, between now and then the sponsors will sprout the competence to get that done. Further, do they have the will and the ability to fix it? Remember, all three major "mistakes" are things Rex likes.
As a medicine using geezer I would prefer to start over thank you.
Chris Kelly

(Report Comment)
Michael Williams August 24, 2013 | 8:36 a.m.

"We will never see a better example of the corrosive effect of big money on our political system."

Really? Hyperbole much?

Well, try this link on for size:

You can "click" on the various headers to follow the money....and the sources from whence it came.

Then you can ponder overuse of the word "never".

(Report Comment)
Michael Williams August 24, 2013 | 10:16 a.m.

Chris: Ok, here's the deal.

I'm not as antagonistic towards you as you might currently believe. In fact, you need to know that of all politicians, you and one other (unnamed) are THE two that I trust the most. Although I am very conservative, I have voted for you every time I have been able.

You represent stability and rationality and common-sense and have done so for years. I do not always agree with you, but I always vote for you because I know you do much more good than not. That's about the best that can be expected from ANY person.

I want you to know that, over the last year, I see you moving more towards a hard-line, extremist Ken Jacob/Chuck Graham/Tim Harlan approach to state political rhetoric....and I don't like it.

You need not do this. In fact, we all need you to NOT do this. Your arguments carry weight and need no help from pandering or alarmist words.

Rationality and common sense will do quite nicely. And you do it quite well. It's what we have come to expect.

Don't change from what we know.......

(Report Comment)
Chris Kelly August 24, 2013 | 11:37 a.m.

Michael, I did not perceive any antagonism, only a question I tried to answer.

I tried to state facts as I see them. Regardless of philosophy this is a badly written piece of legislation. I guess that us what bothers me the
most; the fact that so many of my colleagues are willing to allow and endorse such sloppy work. There are just too many people who are willing to accept bad legislation if they agree with its philosophical goals. If that makes me a hard line liberal I will have to live with it.

Meanwhile, I am happy to discuss any aspect of the legislation.

(Report Comment)
Michael Williams August 24, 2013 | 8:23 p.m.

Chris: I have to admit there are times I wish I could get two opposing politicians in the same room and me possessing the legal means to force the truth, interrupt, and re-ask the same question until I get an answer.

Kinda like a judge, lol.

It distresses me (well, disgusts me is probably more accurate) that politicians often pontificate only one side of a story...the side he/she wants you to believe. Hell, the problem isn't limited to politicians; sales people, editors, lawyers and everyone with an agenda or service to sell does it.

It makes the assumption that most folks are too stupid to hear both sides of an argument and make a rational decision.

I sure hope that assumption is wrong, but the strategy is used a lot so I guess I have to conclude we humans ain't too bright. That isn't good and gives little cause for hope.

But I never like hyperbole, even when I do it myself. It's unbecoming, intellectually dishonest, and an insult to the intelligence of the recipient.

I propose a "competing columns" contest. The Missourian should print a missive from you on this topic and parallel it with a column from an opponent. Then, once we have a couple of days to mull things over, the both of you get a chance to respond to the "lies" and "hyperboles" of the other.

Let's do that 3 times after which we retire to the lawn of the courthouse square for a boxing match.

Either that, or give me the power as noted above. Fines for hyperbole will be $500 and two days in the pokey. Stretching the truth and/or posing only the merits of one side is a life sentence handcuffed to Limbaugh or Van Jones (depending) and no hope of parole.

(Report Comment)
Michael Williams August 25, 2013 | 10:08 a.m.


On the Sunday Morning Roundtable (1400), Caleb Rowden says (1) the prescription problem with the bill WILL get fixed, and (2) the Marketplace Fairness Act has NO chance of getting passed.

Which, if true, means two of your major arguments against this bill are specious, not relevant, and are (perhaps) needlessly alarmist and designed to provoke fear. on.....

Your turn.

(Report Comment)
Joy Mayer August 25, 2013 | 10:17 a.m.

@Michael Williams, thanks for the competing columns idea. It could be interesting not just to publish a point/counterpoint, but then to have each writer commit to a follow-up, responding to the other. Hmmm. I'm passing that idea along to our opinion editor. Thank you.

And @Chris Kelly, thanks for being willing to engage in the comments after your column was printed.

Joy Mayer, Columbia Missourian director of community outreach

(Report Comment)
Chris Kelly August 27, 2013 | 1:38 p.m.

Sorry, I am off with grandkids and cannot play. CK

(Report Comment)

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