Revenue crisis can be solved

Mary Still has done a great job of standing up on the revenue crisis in Missouri.  It's time for action now.

Inaction forced tuition increase.
BY MARY STILL
Columbia Tribune
Tuesday, June 14, 2011

Consider these facts:

The University of Missouri has faced a 10-year decline in state support.
The university’s enrollment has increased by 17,000 during the past 10 years.
The university accounts for 70 percent of the state’s growth in undergraduate enrollment among four-year institutions and is educating these students with the same state support it had 2001.

It is no wonder the Board of Curators and the Coordinating Board for Higher Education approved a tuition increase for MU. While I regret the necessity of that decision, I understand it is essential if we are to preserve quality at the state’s premier public research institution and if we are to move our state forward.

Thus, I was disappointed to learn Gov. Jay Nixon withheld funds for higher education and hit the university extra hard because of the increased tuition.

Of even greater disappointment, however, is the fact legislators and the education community are not facing up to reality. Missouri has a revenue crisis because we stubbornly refuse to do the obvious. 

First, we refuse to raise cigarette taxes, even though we have the lowest rate in the country. We could raise our taxes by 12 cents a package and still be the lowest in the country and bring in more than $60 million a year. Or we could move our cigarette taxes up to be competitive with other states and bring in hundreds of millions in revenue. We would have the added advantage of reducing the $600 million tab the state and federal government pay annually for smoking-related illnesses. It makes sense. Even one Republican senator from a district not our own said to me, “It is indefensible to be the lowest in the nation.” Our own Republican Sen. Kurt Schaefer has said he would support a vote of the people on this issue.

Second, we are not collecting sales tax on Internet transactions. These are taxes owed and easily collected once Missouri joins the interstate compact. Collecting this sales tax has the double value of raising revenue and supporting our local businesses that are at a 6 to 9 percent disadvantage because they collect sales tax. Almost all surrounding states do this, and Missouri could raise $20 million a year almost immediately, with much more to come in the future.  

Third, we could close tax loopholes that almost all other states have closed.

Fourth, we could reject the false theory that low corporate taxes will help us attract industry. If that were the case, we would be swarming in jobs. We already have among the lowest corporate taxes in the country, and last session the legislature voted to eliminate the corporate franchise taxes for companies with more than 10 million in assets. This will cost our state $80 million a year. Legislators who voted in favor of this are part of the problem, not the solution.

Finally, consider our income tax: Those in poverty pay the same rate as multimillionaires. We could alter our tax structure in ways that would not harm the middle class.

In fact, none of these sources of revenue would have a significant effect on the hard-working middle-income families who are playing by the rules but struggling.

What does affect these middle-income families is the fact they can no longer afford to send their children to the state university.

What does affect middle class Missourians are the cuts to education that we will continue to make until we face this reality: Missouri does not have a budget crisis; it has a revenue crisis.  

I recall a quote attributed to Huey Long: “Louisiana ain’t a poor state — it has a passel of poor folks, but it is not a poor state.”

The same will be said of Missouri if we don’t have the political courage to address the obvious. We have the resources to do better. Political courage is what’s missing.

Mary Still of Columbia represents the 25th District in the Missouri House of Representatives.