BY: RUDI KELLER
Missouri Independent
The special session called by Gov. Mike Kehoe could wrap up Wednesday if no changes are made to the bills already passed in the Senate
The special session bills to fund professional sports stadiums in Kansas City and provide disaster relief to St. Louis passed House committees easily on Tuesday, setting up final votes that will send them to Gov. Mike Kehoe.
There were no changes from the Senate-approved versions as the stadium financing bill passed the House Economic Development Committee on an 11-2 vote and a spending bill with $100 million for storm cleanup in St. Louis by a unanimous vote.
As long as there are no amendments passed on the floor, those two bills and another to authorize disaster housing support will be finished Wednesday. If there are any changes, they will have to be approved by the state Senate, which passed all three bills last week.
The immediate purpose of the special session was to get state lawmakers on record with an offer to the NFL’s Kansas City Chiefs and MLB’s Royals before the teams had to make a decision on whether to jump the state line to take a deal offered by Kansas.
The Kansas offer, with a deadline at the end of the month, is a serious proposal and Missouri will lose the teams — and the economic activity associated with them — if it does not put up a counter-offer, said state Sen. Kurtis Gregory, a Republican from Marshall.
Under the stadium bill, Missouri would calculate the tax revenue generated by activities in Arrowhead and Kauffman stadiums — home of the Chiefs and Royals, respectively, since the early 1970s — and dedicate the money to bond payments.
“This isn’t using tax dollars off of the income tax that’s collected from someone that’s working at Dollar General or a feed store or a fertilizer shop or a clothing store or wherever,” Gregory said. “This is using the taxes that are generated at the stadiums themselves, off of Joe Burrow when he comes to play in Kansas City, we collect taxes off his paycheck, or when Taylor Swift has a concert at Arrowhead Stadium.”
Backers of the bill estimate that close to $1.5 billion would be spent over 30 years. The money would pay about half the cost of upgrades at Arrowhead and a brand new stadium for the Royals.
Opponents of the plan tried to persuade the committee to wait. The Chiefs and Royals have not accepted the Kansas offer and haven’t promised to stay if Missouri makes a firm financial commitment, said Patrick Tuohey, a senior fellow at the conservative Show-Me Institute.
“This entire special session and this deal is an absolute hustle,” Tuohey said.
The Kansas offer is dependent on investors being willing to buy bonds backed only by the new tax revenue generated in a district around the stadiums, Tuohey said. That won’t be enough money to service the debt, he said.
“This deadline simply means that the Kansas offer ends,” Tuouhey said. “The absolute worst time for Missouri to offer, to make an offer is during that time. You should wait until after the 30th and see if Kansas wants to extend. But the idea that the Chiefs and the Royals are dictating deadlines to the Missouri Legislature is crazy.”
Under the legislation, Missouri would keep money received that exceeds the current tax revenue, Gregory said. And if the teams move, he added, the state loses both.
“We’re not talking just about the potential revenue loss for the team moving across the state lines,” he said. “I think we are talking about jobs and tax revenue coming from a lot of different places across the Kansas City metro area.”
The property tax cap in the legislation would apply to 97 counties, 75 where base bills could not increase more than 5% per year and 22 more where no increase would be allowed. The bill exempts additions to the tax bill for newly voted levies and the additional value of home improvements.
The bill includes two other major provisions, with the most expensive being a tax credit for people living in areas where a federal disaster declaration has been requested. The credit would be equal to their insurance deductible and available regardless of whether the disaster request is approved. The other provision would renew a tax credit program that supports major amateur sporting events.
The disaster tax credit, only for damage occurring this year, would be capped at $5,000 per person and $90 million total this year. For people who cannot use their full tax credit, the bill would allow them to carry the loss forward for another 29 years and cap the total allowed at $45 million per year.
The provision could eventually cost state taxpayers about $600 million, Dan Haug, state budget director, said in testimony to the House Budget Committee.
“That is what I would call an upper limit,” he said.
In the spending bill, Kehoe initially sought $25 million for housing assistance grants, adding it to the core items he wanted from a construction bill spiked in the House just before a final vote in the regular session. Under pressure from Democratic lawmakers in the Senate — votes vital to passing the stadium package — Kehoe agreed to add $100 million to help St. Louis recover from a devastating tornado that hit May 16.
The bill spends $360 million overall — $175 million of general revenue and $185 million from other funds.
Despite grumbling that many items in the bill spiked during the regular session were badly needed, House Budget Committee Chairman Dirk Deaton, a Republican from Noel, said nothing would be added.
When Kehoe agreed to the additional money, federal recovery aid for St. Louis was uncertain. That changed Monday when President Donald Trump approved the request for a disaster declaration, making federal help to the state and local governments available as well as aid to individuals with damaged property.
The federal recovery aid is welcome but the state funding should be maintained, Haug said to the budget committee.
“These disasters are so expensive that without federal help, there’s no way we can cover all of this,” Haug said. “We just don’t have the general revenue resources to do that.”
Just in the city of St. Louis, Mayor Cara Spencer told the committee, the tornado damaged 23,000 homes and affected 48,000 people.
“Many of the homes that are so badly damaged are generational homes,” Spencer said. “These are homes that represent all that many of these families have.”