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Tax Relief Might Be in Jeopardy

April 20, 1998

By: Lucas Wall
State Capital Bureau

JEFFERSON CITY - Tax relief for Missourians might be in jeopardy this year. The debate stems from a proposed deduction for parents who send their children to private high schools.

Sen. Harry Wiggins, D-Kansas City, wants to give up to a $2,500 state income tax deduction for high-school expenses, which would favor parents who pay tuition. It would cost the state about $8 million a year.

The deduction is being pushed by religious groups and a bipartisan coalition of lawmakers. Of the 18 senators who support the deduction, 10 are Republicans and eight are Democrats.

Supporters say parents who send their kids to private high schools deserve a tax break, while opponents disagree with giving a tax break to such a small group of Missourians. More than 26,000 students attend private high schools in Missouri. Opponents also say it's bad policy to give public funding to private schools.

Opponents stalled debate for three consecutive days last week. A majority vote can end a Senate filibuster, but it's a motion not used by Missouri Senate tradition. Senate Administrator Ron Kirchoff said the Senate has only ended filibusters twice in its history.

Wiggins' bill, an omnibus $71 million tax cut, could see the floor again as soon as 3 p.m. today, but its fate is in doubt. Several senators strongly opposed to the school-expenses deduction now are calling for no tax relief this year, saying they would rather see excess revenue refunded to income-tax payers as required by the state constitution's Hancock Amendment.

Sen. Ken Jacob, D-Columbia, has helped lead the fight against the school-expenses deduction. Following adjournment Thursday, he said he doesn't expect Wiggins' bill will ever see a final vote.

"People value the principle of separation of church and state to such a degree," he said.

Jacob failed three times to amend Wiggins' bill. He said it would now be better to let the bill die and have the Hancock Amendment kick in again. The state recently mailed the first round of Hancock refund checks for 1995-96 taxes.

He defended the use of a filibuster to kill the bill.

"The majority wants to trample on the rights on the minority," Jacob said. "The minority has to defeat those efforts."

Sen. Bill Kenney, R-Lee's Summit, criticized those who are now coming out against a tax cut.

"It's too bad some senators don't want to give tax relief to their constituents," Kenney said.

Other Republicans who generally love tax cuts are having a tough time swallowing this one. Sen. Doyle Childers, R-Reeds Spring, said he fears it's a back-door way for the state to regulate private schools.

"I'd rather not have government interference in private schools," he said.

Childers, who also is concerned about the constitutionality of the deduction, said he wants the Senate to come to some agreement so there can be tax relief this year.

Sens. John Russell, R-Lebanon, and Morris Westfall, R-Halfway, also oppose the school-expenses deduction. They said the odds are against a tax cut this year unless it comes out of this bill.

Senate President Pro Tem Bill McKenna, D-Barnhart, supports the deduction. Calling himself the eternal optimist, McKenna expressed hope an agreement on tax cuts can be reached.

"I'd rather reduce revenue than send out refunds because I think that's expensive," McKenna said.

But given the strong opposition, Jacob said he wouldn't be surprised if Wiggins' bill is never brought back to the floor.

This is the second consecutive year the school-expenses deduction has snarled the Senate. The Senate passed the deduction in 1997, but a conference committee removed it.

Gov. Mel Carnahan has called for $120 million in tax cuts this session to prevent more Hancock refunds. Chris Sifford, Carnahan's spokesman, said the governor remains opposed to the school-expenses deduction.

"We would have some big concerns about any provision that shifts the focus away from public schools and public education," Sifford said.

Carnahan has endorsed a $35 per-taxpayer credit for housing and an expansion of the "circuit-breaker" property-tax credit for senior citizens and the disabled.

"We think it's important we provide tax relief to Missourians, and we have an opportunity to cut the taxes that homeowners and renters pay," Sifford said. "We think that's a more equitable method of cutting taxes, and we are going to work hard to get that tax cut bill done this year."

The House Ways & Means Committee approved Carnahan's proposal Feb. 11, but it has not been scheduled for floor debate. Bills that have not yet been added to the debate calendar have a slim chance of seeing further action this session. The Senate has passed a bill to expand the circuit-breaker credit.

Sifford said it will take an intense lobbying effort by the governor's office during the last month of the session to get Carnahan's proposal through the legislature.

"You'd think it'd be easier to pass a tax cut," Sifford said.