Missouri Lawmakers Race To Pass School-Finance Revision

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The Missouri legislature late last week was racing to pass before the close of the legislative session a compromise measure that would revise and fund a new school-finance system.

As the deadline for adjournment loomed last Friday, education officials and lobbyists gathered to await a vote on a measure approved by a conference committee, which they hoped would reconcile politically charged differences over how to raise the money to pay for the new system.

"This probably is the most intensively lobbied bill, maybe in the history of this state, and certainly in recent years,'' Joel D. Denney, the state's deputy commissioner of education, said Thursday as he awaited a Senate vote on the measure.

In addition to the statutory deadline for closure, lawmakers were spurred to action by the prospect that they might also fail to meet a mandate imposed by Circuit Judge Byron L. Kinder to revise the $1.1 billion formula, which he declared unconstitutional early this year. (See Education Week, Jan. 27, 1993.)

Judge Kinder gave the legislature until 90 days after the close of the regular session to act. Lawmakers were pressing to finish last week in order to avoid having to return for a special session on the issue.

In recent years, the legislature has repeatedly failed to revise the formula, which was strongly criticized by Judge Kinder for being overly complex and for failing to reduce disparities in spending between rich and poor school districts.

Earlier this month, as efforts to rewrite the formula appeared to stall, Gov. Mel Carnahan forcefully reminded legislators that they should seize the opportunity to avoid having Judge Kinder revise the formula.

"We are under a mandate to fix the foundation formula and fund it,'' Governor Carnahan said. "I don't see how anyone can read that opinion and feel otherwise.''

The bill approved by conferees would raise $348 million in new taxes to fund the formula, largely by eliminating state deductions for federal income taxes.

At the same time, the measure would alter the formula itself in order to steer more state aid to low-wealth districts. It also would include a hold-harmless provision, however, to prevent districts from receiving less aid under the new measure than they received this year.

In addition, the legislation would require districts to set a property-tax rate of at least $2.75 per $100 of assessed valuation.

Heavy Lobby Pressure

Heavy lobbying pressure by Governor Carnahan was necessary because lawmakers were clearly chary of approving the tax increases required to fund the new formula.

In an unusual joint session on school-finance reform last month, Mr. Carnahan had presented a proposal to raise $365 million in new taxes by eliminating the state income-tax deduction for federal taxes on household incomes above $100,000 and increasing business taxes. It also called for raising the minimum property-tax rate to $2.75. (See Education Week, April 21, 1993.)

But when a bill based closely on the Governor's plan came before the House late last month, it was rejected on a vote of 85 to 69.

After considerable arm-twisting by the Governor and his allies, however, the bill subsequently passed the House and went to conference with a separate measure approved by the Senate.

Other significant proposals that surfaced during debate on the legislation included a business-backed plan to impose an "education surcharge'' on personal and corporate taxes. In addition, President Pro Tem of the Senate James L. Mathewson had championed a proposal to impose a temporary sales-tax increase of one-eighth of a cent.

Vol. 12, Issue 34

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