Missouri Gov. Jay Nixon is opposed to a proposed sales tax increase to raise $5.4 billion during the next decade for transportation work. Voters will decide the fate of the three-fourths-cent general sales tax this summer.
The governor’s office issued a statement on Monday, June 2, that acknowledged the state’s “long-term transportation infrastructure needs.” However, he said the proposal “would fall disproportionately on Missouri’s working families and seniors … while giving the heaviest users of our roads a free pass.”
State lawmakers approved the transportation sales tax question with bipartisan support. The Senate approved it on a 22-10 vote and House lawmakers followed suit on a 105-43 vote.
As approved by lawmakers, the question was set to appear on the November general election ballot. However, Nixon elected to push up the date to the Aug. 5 primary ballot. The decision is viewed by many to be a death knell for the proposal.
Election researchers have long viewed primaries as attracting a party’s extreme – on both sides of the aisle. As a result, the proposed sales tax increase is expected to face a significant uphill battle to win support.
“This tax hike is neither a fair nor fiscally responsible solution to our transportation infrastructure needs, and it does not have my support,” Nixon said.
The governor also criticized lawmakers for approving a package of tax breaks that he described as a “headlong rush to provide special breaks and carve-outs for the wealthy and well-connected.”
The group of bills approved in the final hours of the legislative session would grant sales tax exemptions to businesses that include data processing and storage centers, recreation venues and fast-food restaurants.
If approved by voters, the general sales tax for transportation would kick in starting Jan. 1, 2015. It wouldn’t be applied to groceries and prescriptions.
About $480 million annually would be used for highways, transit, ports, airports, and bike and walking paths. The remaining $54 million a year would be split between cities and counties for local projects.
Voters would decide in 10 years whether to extend the tax for another decade.
A protection was included to prevent revenue from the tax being diverted away from transportation.
State lawmakers would also be prohibited from increasing the state’s 17-cent-per-gallon fuel tax or charging highway users to drive on existing roadways without voter approval.
Advocates for the tax increase say something needs to be done to help the Missouri Department of Transportation address an approaching funding cliff.
MoDOT Director Dave Nichols has referred to the state’s construction budget for roads and bridges, which has fallen from about $1.3 billion annually in 2010 to $685 million this year.
He added that there is no light at the end of the tunnel. The annual budget is projected to dip to $325 million by 2017 – the lowest since 1992.
The agency is expected to release a list of projects by mid-June that could be funded if voters approve the tax increase.
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