Amendment 7, which hoped to establish a permanent state investment fund, has failed.
The stated goal of the “Show-Me Prosperity Fund” was to create a state-managed investment fund that would mature to the point that “state-imposed taxes” could be eliminated. This was estimated to take decades to occur, if ever.
Critics of the amendment said it left too many questions unanswered, such as where the money for the fund would come from and to what services the money would be directed.
Many other states have similar sovereign wealth funds, though most have a designated funding stream, such as from natural gal or oil revenue.
Missouri’s Amendment 7 did not specify where the money for the fund would come from, which left some critics concerned that the state legislature would pull from Missouri's General Revenue Fund, which is already used to fund public schools, higher education, corrections and more.
This comes after Missourians overwhelmingly rejected a different attempt at changing state tax policy, Amendment 5, in the August primary.
Amy Blouin is the President & CEO of the Missouri Budget Project, a public policy research and advocacy organization. She said she hopes these results can lead to real tax policy solutions, instead of — “gimmicks.”
“We know that we're going to have a steep budget cliff already. We expect around a $2 billion hole that needs to be filled, and there's just no way to get at that without looking at the tax policy choices that lawmakers have made,” Blouin said.
She said Amendment 7 was just the latest attempt by Missouri Republicans to change income tax policy, and was, in reality, a “backdoor attempt to get at Amendment 5,” which was overwhelmingly defeated in the August primary.
“You would hope that after a couple of attempts this year, that politicians would start recognizing that the voters are not with them on these issues,” Blouin said, “and instead start listening to Missourians about what it is that they want and need.”
Representative Colin Wellenkamp (R-St. Charles County) advocated for the fund. He said the results show that Missourians are more focused on the present affordability of goods and services.
“The state of Missouri has very immediate concerns,” Wellenkamp said. “They're not in a place to look to the future, to build something for our grandchildren, as it were, which is unfortunate.”
Though he did not win reelection Tuesday night, Wellenkamp said he hopes Missouri legislators will continue to explore “innovative financing solutions,” which, he said, must be found to address ongoing fiscal demands.
“I completely understand where voters are coming from,” Wellenkamp said. “Perhaps in the not too distant future, when times are better and fiscally folks aren't feeling so tight at home themselves, this can be a more luxurious consideration that people may be able to have the capacity to entertain, but not right now.”
Both Blouin and Wellenkamp spoke of how data centers could play a role in meeting the state’s projected budget deficit. Blouin discussed eliminating the sales tax exemption for data centers, while Wellenkamp proposed having the same data centers contribute to a sovereign wealth fund, if one was ever created in the future.
