The Buzz

Tough battle for tax to fix Missouri roads

Updated: 2013-10-31T03:37:28Z

By JASON HANCOCK

The Star’s Jefferson City correspondent

— Supporters of a penny sales tax hike to pay for roads and bridges in Missouri, stiffed by the legislature, now aim to put the question on the statewide ballot themselves.

If they succeed, voters will decide in November 2014 whether to increase the sales tax for the next 10 years to rebuild a 200-mile stretch of Interstate 70 and fix hundreds of bridges, off-ramps and smaller highways around the state.

Getting on the statewide ballot can prove long, difficult and costly. Even a measure that isn’t particularly controversial can end up costing millions.

Convincing Missourians to sign off on a tax increase is even tougher.

But supporters of the tax — from highway contractors and the state’s Chamber of Commerce to labor unions and the Missouri Farm Bureau — promise an aggressive effort to sell voters on a road-building and repair plan that rivals the Dwight Eisenhower age of interstate highway construction.

And while the final price tag of the campaign could be hefty, it will pale in comparison to the payoff if supporters succeed: roughly $8 billion in additional infrastructure funding over the next decade and an estimated 270,000 construction jobs.

“I hate taxes as much as the next guy,” said Sen. Mike Kehoe, a Jefferson City Republican who has championed the idea of increased transportation funding for years. “But we have to look at this as an investment. This would be a tremendous economic boost for the next decade while rebuilding an aging transportation system.”

If approved by voters, the state sales tax rate would climb to 5.225 percent from 4.225 percent for 10 years. The state transportation commission would have to develop and publish a list of specific projects that would be funded by the tax increase before any ballots are cast.

Of the additional revenue, 5 percent would be designated for cities and counties to pay for local transportation needs. That money could be used for any transportation project, including mass transit.

Supporters say Missouri can’t take care of its 33,000 miles of highways without an infusion of money. The national economic recession devastated the state’s transportation budget, with construction funding falling from $1.2 billion to less than $700 million in recent years.

In pushing their plan, however, supporters acknowledge they face an electorate in Missouri loathe to raise taxes of any kind. Just last year, voters resoundingly rejected raising the state’s lowest-in-the-nation cigarette tax to boost education programs.

Advocates for the transportation sales tax got a glimpse of that opposition earlier this year. Bipartisan majorities in the Missouri House and Senate approved a version of the idea, but with only one roll-call vote in the Senate to go, a handful of conservative Republicans began a filibuster that ultimately killed the bill.

Opponents complained that voters didn’t give Republicans a supermajority in the Missouri General Assembly to pass the largest tax increase in the state’s history.

“A one cent sales tax is a huge tax increase for Missourians,” Rep. Andrew Koenig, a Manchester Republican, said in a recent interview with Missouri Digital News. “That’s something I’m going to be opposed to.”

While any tax increase faces an uphill fight in Missouri, Kehoe said voters can take solace in the fact that the sales tax hike will expire in 10 years, and during that time the gas tax would be frozen and toll roads would be prohibited.

Meanwhile, numerous Democrats openly criticized the plan over the potential impact of a sales tax increase on those living in poverty. While the state sales tax is currently only 4.225 percent, they point out that in some parts of Jackson County, for example, the tax is already higher than 10 percent.

“There’s no doubt we need to increase funding for infrastructure projects. It’s a good, smart government investment,” said Rep. Jon Carpenter, a Gladstone Democrat. “But there are more equitable ways to pay for it that wouldn’t hit low-income folks as hard as a sales tax, which most agree is a regressive form of taxation.”

Instead, Carpenter suggested restructuring the state’s tax code and reining in tax credits that cost the state more than $600 million last year — fully one-twelfth of the state budget.

If lawmakers had placed the issue on the ballot, it would have saved proponents a lot of money. At the very least, it would have allowed them to focus fundraising efforts on building a campaign war chest to convince voters of the value of the sales tax increase.

Now, they’ll have to spend some of that money just to get on the ballot — collecting signatures and, potentially, fending off any legal challenges that usually emerge with high-profile initiative petitions.

Another attempt could be made at swaying the General Assembly, Kehoe said, but “opposition in the Senate isn’t going anywhere, so the legislative avenue is likely closed.”

If supporters want to get on the November 2014 ballot, there likely isn’t enough time to wait on lawmakers anyway, said Bill McKenna, a former Democratic lawmaker and spokesman for the not-for-profit Missouri Transportation Alliance.

“The roads are just getting worse, and we need jobs so bad that we can’t wait any longer,” he said. “If the legislature wants to pass their own ballot measure, that’s fine with us. But we’re going to continue to work on our own in the meantime.”

The proposed initiative petition has been submitted to the Missouri secretary of state’s office, which will write a summary to appear on the ballot. After that, supporters can begin collecting signatures — they’ll likely need about 160,000 — to put the measure before voters.

A political action committee called “Missourians for Safe Transportation and New Jobs” has already raised $63,000 for the effort in a little less than a month.

For comparison, the committee advocating for last year’s cigarette tax hike raised roughly $5 million for the unsuccessful campaign. In 2010, retired financier Rex Sinquefield spent $11.2 million on the successful ballot initiative that forced a vote on earnings taxes in Kansas City and St. Louis.

Kehoe points out, however, that unlike those campaigns, there has thus far been no organized opposition to the proposed sales tax increase.

While nothing is set in stone, both Kehoe and McKenna agreed that rebuilding I-70 would assuredly be among the top projects funded by an increased sales tax. State transportation officials have warned that the road will be a “gravel parking lot” in less than 20 years if the state doesn’t make improvements.

“I don’t think it’s going to make it 20 years,” Kehoe said.

The cost of rebuilding I-70 would depend on the scale of the project. The most likely plan could cost around $1.8 billion and include replacing the pavement along the entire interstate and adding a third lane in each direction.

“It’s the main street of our state,” McKenna said. “There have been lots of ideas about how to fund it over the years, but right now this ballot measure is probably the only thing on the table.”

To reach Jason Hancock, call 573-634-3565 or send email to jhancock@kcstar.com.

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