Missouri income tax repeal proposal sparks concerns about public education funding

ST. JOSEPH, Mo. (KQTV) -- Missouri lawmakers are adamant that eliminating the state income tax will benefit families across the state, but not everyone is convinced this idea will help people in the long run.

On Tuesday, the Missouri House of Representatives voted, 95-59, to approve House Joint Resolutions 173 and 174 that takes the future of the state income tax to the voters in November.

While there are a lot of Missouri politicians excited about the potential elimination of the income tax, there are those working in school districts that are worried about future funding.

"I worry that the outcome of that will result in reduced revenue over time in the state of Missouri," said Robert Hedgecorth, St. Joseph School District's Assistant Superintendent. "And since education is a big part of what the state funds, you're going to see some deep cuts to education as a result of that."

The House Joint Resolutions fall in line with Missouri Governor Mike Kehoe's mission to eliminate the state income tax. The proposed ballot measure would eliminate the income tax by 2032, but it will potentially expand and increase local sales taxes to offset lost revenue.

Northwest Missouri State House of Representatives and State Senators supported sending the measure to voters. Representative Bill Falkner (R-District 10), Rep. Jeff Farnan (R-District 1), Rep. Sean Pouche (R-District 13), Rep. Brenda Shields (R-District 11), and Rep. Dean Van Schoaick (R-District 9) voted yes on the measure.

In the State Senate, Senator Rusty Black (R-District 12) and Sen. Tony Luetkemeyer (R-District 34) also supported the HJRs.

"Eliminating the individual income tax represents the largest middle class tax cut in the state's history," Luetkemeyer said.

Some Missouri representatives are critical of the measure and believe that it will hurt Missourians.

"There is no universe in which we eliminate the income tax without drastically increasing sales taxes on every single Missourian," State Rep. Ashley Aune (D-District 14) said.

There are also some fear about the future of state funding for public education.

"The state of Kansas tried this back in 2012," Hedgecorth said. "They didn't even take their income tax all the way down to zero. They just reduced it by about 1.5%. During that 5-year period, they had three credit downgrades and they were underfunding education to the point where the Supreme Court of Kansas stepped in and mandated to increase the funding.

The Missouri Budget Project, a non-profit and non-partisan public policy analysis group, estimated the ballot measure will disrupt billions of dollars in the state budget. With the possibility of billions of dollars in lost revenue, it might mean that there will be drastic cuts to public education.

"It would, you know, blow this hole in our state budget that would have a direct impact on our classrooms, our teachers," said Traci Gleason, Missouri Budget Project's vice president of external relations.

The organization created an interactive map showing the potential impacts of eliminating the state income tax with some schools potentially looking at an 18% cut in total school revenue including local funds.

According to the Missouri Budget Project, the St. Joseph School District is facing an almost $14 million loss in 2032, which is about 7% of the district's budget. The organization's data revealed that the $14 million is equivalent to cutting 253 teachers of 440 support staff.

"You would have to see those classroom sizes increase because you're losing funding," Hedgecorth said. "I think you're going to lose some educational opportunities for some students unfortunately.

Next to legislators, some voters have already expressed worry regarding the passing of the bill, while others can't wait for the elimination to be implemented. If voters end up passing the measure in November, there might be changes when it comes to local sales taxes and funding for areas like public education.

"With 75% of our expenses being people, because we're in the people business," Hedgecorth said. "We're here to educate students and that takes a workforce and that is the logical place where we would have to look to scale back to ride out the reduced revenue that we would see from the state."

There are nine states that currently do not have a state income tax: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming.