Office of Missouri Governor

Gov. Jay Nixon today vetoed legislation containing more than a dozen special breaks and exemptions passed in the final hours of the legislative session. These special interest carve-outs would reduce state and local revenues by up to $776 million annually and were not accounted for in the Fiscal Year 2015 budget passed by the legislature or in the budgets of the local jurisdictions they would impact. In a letter addressed to members of the General Assembly, the Governor faulted the legislature for ignoring the legislative process and adding new loopholes to the tax code that will shift a greater tax burden to the majority of taxpayers.

“Rushed through with little debate in the final hours of the legislative session, these special breaks and exemptions for a handful of special interests are the result of a deeply flawed process and a fundamentally misguided approach to tax policy,” Gov. Nixon said. “Many of the most costly provisions were slipped into bills without a public hearing or even a fiscal note, and none of these giveaways were accounted for in the budget the legislature sent to my desk or in the local budgets of the jurisdictions they would impact.”

The provisions include special breaks for fast food restaurants, personal seat licenses, commercial dry cleaners and laundries, data storage and processing, certain used vehicles, farmers’ markets and fitness centers. The fiscal impact of these provisions, which would reduce state and local revenues by as much as $776 million annually starting in the fiscal year that will begin on July 1, was not accounted for in the budget passed by the General Assembly or in the budgets of local jurisdictions. This includes a $425 million annual reduction in state tax and a $351 million reduction in local taxes.

Most of these provisions would impact sales tax collections, and therefore would reduce local tax revenues that support police, fire, ambulance, emergency services, parks, children’s services and other public services provided at the local level. The loss of local revenue from these provisions could also impact repayment of voter-approved bonds issued to finance capital improvements such as county jails, county hospitals, fire stations, emergency management centers, road projects and other critical public infrastructure.

“These special carve outs and loopholes would undermine local public services and flout the will of voters by eroding revenues that support services like firefighters and cops, libraries and ambulance services, snow plows and health inspectors, public transit and road repair,” Gov. Nixon said. “From storm water management in West Plains to fire protection in Webster Groves, voters in communities across Missouri have come together to pass local sales taxes to support local public services and capital improvements . These special breaks passed by the General Assembly would siphon these voter-approved resources away from their intended purpose, and into the pockets of the well-connected.”

The reduced state sales tax revenue would also reduce funding from dedicated sales taxes for K-12 schools (also called the Proposition C sales tax), Highways, Conservation, State Parks, and Soil and Water Conservation Programs.

“Perhaps most troubling is the way the General Assembly is carving out special sales tax breaks for a select few, while pushing a $6.1 billion sales tax hike on all Missourians,” Gov. Nixon said.   “Passing secret, sweetheart deals so that the well-connected can pay less, while asking all Missourians to pay more, reflects priorities that are dangerously out of whack.”

Senate Bill 693, which would reduce state and local highway funding by more than $30 million annually, was passed just two days after legislators sent to the ballot a $6.1 billion sales tax increase to fund roads.

“Instead of engaging in an open and honest debate about the overall tax policy of our state, the legislature has once again opted for an undisciplined, scattershot approach by adding more loopholes to the already dizzying array of carve-outs that riddle our tax code,” Gov. Nixon said. “My vetoes today are a first step toward restoring fiscal sanity to a budget process that has gone off the rails.  That being said, I have the responsibility to maintain fiscal discipline regardless of whether my vetoes are sustained.  Moving forward, I will take the actions necessary to account for the reduced state revenues resulting from these giveaways and keep our state on a fiscally sustainable path.”

The Governor vetoed the following bills:

• Senate Bill 693, which would exempt from state and local sales tax certain used vehicles and rights of first refusal for tickets sold at the Sprint Center in Kansas City, and would expand the Wine and Grape Production Tax Credit;
• Senate Bill 584, which would, among other provisions, exempt from state and local sales tax items used in the storage or processing of data in any form, items used in the generation, transmission, distribution, sale or furnishing of electricity by power companies, and certain fees paid to places of recreation.
• House Bill 1865, which would create new exemptions from state sales taxes for the cost of utilities used by restaurants, grocery stores, convenience stores, fast food restaurants and other facilities engaged in food preparation;
• Senate Bill 612, which would exempt commercial laundries and dry cleaners from state and local sales taxes on various purchases, and would waive tax liability for certain business.
• Senate Bill 860, which would enable a purchaser to obtain a sales or use tax refund, even when they have current tax delinquencies;
• House Bill 1296, which would authorize certain corporations to utilize an alternative method of determining the amount of their income that is derived in Missouri and would add graphing calculators to the back to school sales tax holiday.
• Senate Bill 727, which would exempt certain items purchased from some, but not all, farmers’ market vendors from state and local sales and use taxes;
• Senate Bill 662, which would waive tax liability for certain businesses and would exempt from sales tax rights of first refusal for tickets sold at the Sprint Center in Kansas City;
• House Bill 1455, which would allow a business to claim a sales tax exemption without requiring it to prove eligibility for the exemption;
• Senate Bill 829, which would enact duplicate legislation to House Bill 1455.

WELLSTON (AP) – A Normandy High School junior faces child pornography charges for allegedly recording a sexual act between two classmates on his cellphone and then sharing the video with other students.

KTVI-TV reports that 17 -year-old Martez Young-Caldwell is accused of encouraging a 15-year-old girl and 16-year-old boy to be filmed while the three students skipped class on June 3 at the St. Louis County school.

Wellston Police Chief G. Thomas Walker says Young-Caldwell turned the camera around to show his own face after filming the two younger students on his phone.

Young-Caldwell was charged with second-degree promotion of child pornography and is in custody on a $25,000 bond. Online court records didn’t list an attorney on his behalf.

ST. LOUIS (AP) – The indoor football stadium that the St. Louis Rams call home is running out of money.

The St. Louis Post -Dispatch reports that the publicly-funded Edward Jones Dome anticipates needing an extra $40 million to cover maintenance over the next 15 years. The St. Louis Regional Convention and Sports Complex Authority, which owns the downtown dome, expects to exhaust its $16 million in savings in six years.

The dome receives $4 million annually for yearly maintenance for the city of St. Louis, St. Louis County and the state of Missouri.

The stadium’s future remains in limbo as lease negotiations between St. Louis Rams owner Stan Kroenke and the stadium authority drag on. The Rams can break their 30-year lease after the upcoming season, which would be a decade early.

DAVID PITT, Associated Press

DES MOINES, Iowa (AP) — A nonprofit network of investors, companies and public interest groups says in a new report that manufacturers depending on U.S. corn and other commodities must send strong signals to farmers to help preserve water and soil.

MATTHEW BARAKAT, AP Business Writer

ALEXANDRIA, Va. (AP) — A federal jury is hearing testimony that Facebook infringed on patents held by a Dutch computer programmer who launched a website called “Surfbook” more than a decade ago.

WASHINGTON – As millions of Americans fall prey each year to weight-loss diet scams, U.S. Senator Claire McCaskill-who chairs the Senate’s Consumer
Protection panel-will lead a hearing next Tuesday with testimony from Dr. Mehmet Oz, host of the Dr. Oz Show, to examine deceptive advertising of weight-loss products and to determine what more can be done to protect consumers.

McCaskill’s hearing follows recent enforcement actions against companies engaged in deceptive advertising of weight-loss products. Last month the Federal Trade Commission (FTC) announced that it is suing the Florida-based company, Pure Green Coffee, alleging that it capitalized on the green coffee bean diet fad by using bogus weight-loss claims and fake news websites to market its dietary supplement. The FTC claimed that weeks after green coffee was promoted on the Dr. Oz Show, Pure Green Coffee began selling their Pure Green Coffee extract, charging $50 for a one-month supply.

Additionally, the FTC in January announced $34 million in settlements against marketers of fraudulent weight-loss products who deceived consumers with baseless claims. And the FTC issued updated guidance for publishers and broadcasters on how to spot phony weight-loss claims when screening ads for publication.

McCaskill’s hearing in the Senate Subcommittee on Consumer Protection will take place at 10:00 a.m. ET on Tuesday, June 17.

KANSAS CITY, Mo. (AP) — Federal investigators say the Kansas City man who was injured when his house exploded last week has died.

Investigator John Ham says 52-year-old Wiley Mitchell Jr. died Tuesday.

The Bureau of Alcohol, Tobacco, Firearms and Explosives says a preliminary investigation indicates someone in the house was making illegal fireworks before the explosion.

Another man and two children were treated and released at a hospital after the explosion.

KCTV-TV reports Ham said his team has finished its work at the home and forensic testing is being conducted on items found in the house.

MONETT (AP) – The state has filed a notice of violation against Tyson Foods after a chemical spill killed fish and caused Monett’s wastewater treatment plant to fail last month.

The plant’s failure caused a nearly complete fish kill in Clear Creek between Monett and Pierce City. The number of fish killed is still being tabulated.

The Missouri Department of Natural Resources referred the incident to the Water Pollution Control Branch in Jefferson City, which will determine final action against Tyson.

The Joplin Globe reports the city of Monett also was issued a violation notice for not meeting effluent limits from its wastewater treatment system. But the DNR says Tyson appears to be responsible for the chemical discharge.

LOS ANGELES (AP) — NASA has postponed its plan to send a “flying saucer” into Earth’s atmosphere to test technology that could be used to land on Mars.

Spokeswoman Shannon Ridinger says weather conditions caused Wednesday’s launch of the saucer-shaped vehicle to be scrubbed. The next potential launch date is June 14.

For decades, NASA has depended on the same parachute design to slow spacecraft after they enter the Martian atmosphere. But it needs a larger and stronger parachute if it wants to land heavier objects and astronauts.

After being launched via balloon from Hawaii, the new vehicle will ignite its rocket engine and climb to 34 miles. It will slow itself down from supersonic speeds and unfurl a parachute for a water landing.

Engineers will analyze the data to determine if the test was successful.

TOKYO (AP) — Toyota Motor Corp. says it is recalling 2.27 million vehicles due to problems with front passenger airbag inflators.

The company said Wednesday that it was notifying owners of vehicles involved in a 2013 safety recall, including 766,300 in the U.S., to replace airbag inflators. It said it had missed some of the affected devices due to incomplete serial numbers from the supplier.

The inflators contained improperly made propellant that could cause them to work abnormally, and possibly cause fires, in case of a crash.

Of the total number of vehicles affected by the current recall, 650,000 are in Japan and 1.62 million outside Japan.

The recall involves about 20 Toyota models, including some Corolla compacts and Tundra pickups made in 2003-2004 and some 2002-2004 Lexus SC 430 coupes.