By Ray McCarty, rmccarty@aimo.com
April 14, 2023 - We want to update you, our business members, on our legislative activity for the last week, representing the business position on some important legislation. If you have any questions or would like to learn more about any of these issues, please contact me at the email address above. Of course, we are doing much more than is reflected in this article, but this article is a good high-level review. By the way, if your business is not yet a member of Associated Industries of Missouri (AIM), please consider joining and supporting our efforts.
The Missouri House and Missouri Senate have 18 legislative days to go in the 2023 Legislative Session - not that I'm counting. Because of the relatively slow pace of the legislative session, senators and representatives are loading up bills and nearly every bill coming out of every committee will contain a host of issues that are somehow connected to the broad subject of the bill (at least most of the time). This will create large bills that have a good chance of facing a veto if they are adopted in their current form. Between now and the end of session May 12 at 6:00 p.m. we will be working to ensure as many of our priorities are in the bills that have the best chance of not only passing the legislature, but being signed into law by Governor Parson.
MISCELLANEOUS
While you were probably not expecting us to start the article with the "miscellaneous" category, there was a hearing this week on a bill we absolutely oppose: SB 554 (McCreery) allowing anyone the right to modify ALL devices. Billed as "right to repair", I pointed out to the Senate committee hearing the bill this week that the right to repair already exists and the bill should be called the "right to modify." This bill allows third parties access to intellectual property, would result in government price fixing, and would result in safety and quality concerns for existing and future owners of modified equipment. No action was taken on the bill in the hearing this week. To learn more about the right to modify, see our slideshow HERE.
TORT AND LEGAL REFORM
HB 272 (Riley), reducing the statute of limitations for personal injury claims from Missouri's extraordinarily long five years to two years (a top tort reform priority for AIM) will face a vote in a rules committee Monday and then will be eligible for debate by the full House. However, as you know from previous articles, the blockade of tort reform has been in the Senate.
AIM is a member of the Missouri Civil Justice Reform Coalition, led by Rich Aubuchon, along with many other businesses and organizations. SB 117 (Luetkemeyer), the Senate companion bill to change the statute of limitations from five years to two years like many other states, has been stalled in the Missouri Senate due to a filibuster by Sen. Bill Eigel and several other senators. The Coalition met with Senate Majority Floor Leader Cindy O'Laughlin this week to emphasize the importance of this bill to Missouri businesses.
The Coalition is also running social media ads, paid for by the Coalition, about the situation which you may view here:
MISSOURI EMPLOYERS MUTUAL PRIVATIZATION
SB 181 (Crawford) would allow Missouri Employers Mutual Insurance Company (MEM) to be a private company, a change from its current quasi-governmental status. The change is necessary to allow MEM to write workers' compensation policies for companies with operations in Missouri and other states. Current restrictions prevent MEM from writing such policies. AIM is fully supportive of this change. The bill was approved by the House Insurance Policy Committee and will have a second committee vote this week. Approval by that committee will place it on the calendar for debate in the House. However, this is an example of a single issue bill that was "loaded up" with other bills in the House committee, including provisions on lender-placed insurance, aviation insurance, transportation network company vicarious liability protection, earned wage access service provider regulation, and consumer legal funding.
ENVIRONMENTAL ISSUES
This week, AIM's top environmental priority that would extend the current fee setting process, prevent the reversion of fees to decade-old levels, and prevent the Missouri Department of Natural Resources from using guidance documents in punitive actions advanced in both the House and Senate. Rep. Bob Bromley added the language to HB 631 (Houx) along with language regarding earthen basins (see below) has been referred to committee in the Senate, and a hearing is scheduled for next Tuesday. The standalone House bill, HB 779 (Bromley), is waiting to be assigned to committee in the Senate. The Senate bill, SB 395 (Bernskoetter), was approved by a Senate committee this week. As was the case in the House, AIM was the only statewide general business advocacy group to support the Senate bill in the hearing.
A bill to clarify permits are not required for earthen basins also advanced this week. HCS HBs 1207 & 622 (Cook) was perfected in the House. Associated Industries of Missouri was again the only statewide business advocacy organization to testify in support of this language that helps protect quarries from a potential misinterpretation of the current law and associated fees. The bill requires one more vote before advancing to the Senate.
HUMAN RESOURCES
HB 1187 (Seitz) is a comprehensive bill allowing people in many situations, including employment settings, to reject COVID immunizations for any reason without repercussions. AIM opposed the bill in a hearing this week.
HB 188 (Murphy) requires all employers to enroll in and use the E Verify federal work authorization program. Most smaller businesses do not have this mandate under current law. The bill also establishes criminal liability for employers that employ workers that are not authorized to work in the U.S. AIM opposes the bill because of the required use of E Verify and the criminal provisions.
Drug masking products that help workers avoid testing positive on drug tests, would be illegal under HB 468 (Gregory) that was heard this week in a House committee. AIM was the only statewide business organization to support the bill, noting the impact of such drug masking products on not only workplace drug testing but also on workplace injury investigations, workers' compensation liability, and the health and welfare of other employees.
SB 60 (Razer) would allow smaller employers to be sued for discrimination based on sexual orientation and gender identity. AIM was the only statewide business advocacy group to testify against this bill that could affect approximately 20% of Missouri businesses that have more than six and less than 15 employees and potentially move cases against all employers from federal to state courts. See our full article on the topic HERE. There was no action on the bill this week.
ECONOMIC DEVELOPMENT
Bills to revive Missouri's film tax credit and establish a new rehearsal facility tax credit advanced this week. AIM believes these incentives will help Missouri establish permanent industries that provide support to film makers (sound, lighting, set construction, etc.) and will attract many professional performers to use the rehearsal credit to test lighting and sound and to rehearse at a facility like the Gateway Studios and Production Services facility in Chesterfield, MO. The rehearsal credit requires performers to conduct at least two concerts in Missouri and would expire if similar incentives in other states expire. HB 675 (Gregory) containing both incentive programs is scheduled for hearing in a Senate committee on Monday. SS SCS SB 94, 52, 57,58 & 67 (Hoskins) has already passed the Senate and was heard in the House committee last week, with a vote scheduled for Monday. And HB 133 (Hudson) has passed the House and was heard in Senate committee last week but did not receive a vote this week.
SB 638 (Fitzwater) is a bill supported by AIM that allows utility companies to lower gas rates for commercial and industrial customers that are expanding in Missouri. The bill was heard this week in a Senate committee. HB 1143 (Keathley) was approved by a House committee two weeks ago and will face another committee vote before consideration by the full House.
SS SCS SBs 3 & 69 (Hoskins) contains several economic development programs: Right to Start Act (information on state contracts awarded to businesses less than three years old), Office of Entrepreneurship, and a Regulatory Sandbox (providing relief from regulation for testing of new ideas and processes). The Small Business Regulatory Fairness Board would be eliminated in the bill as it is no longer active. The bill was heard in a House committee last week and a vote is scheduled for Monday.
TAXES
AIM's bill that would exempt brain cancer treatment devices and other durable medical equipment from sales and use taxes advanced again this week. While AIM is the only statewide business group in support of the bill, the Missouri Department of Revenue also supports the bill. SS SB 143 (Beck), an omnibus bill containing several tax exemptions and the durable medical equipment exemption, was referred to a House committee and a hearing scheduled for next week. Also this week, HB 154 (Thomas) was heard in the same Senate committee that heard the Senate version of the bill and was approved by that committee; however, many additional items were added to the bill:
A bill that would increase the amount of food pantry tax credits from $1.75m to $2.75m and extend it for another year (it would expire in 12/31/27 instead of the current expiration date of 12/31/26); COST - $1 million
A complete sales tax exemption for food (filed in SB 161); COST- $1.5 billion
A complete sales tax exemption for diapers and feminine hygiene products (also contained in SS SCS SB 73 & 162); COST - $50-116 million and,
A sales tax exemption for transmission and distribution equipment (another AIM priority bill, SB 275) COST - $20 million
TOTAL COST OF ALL THE ADDITIONAL ITEMS: up to $1.6 billion
We will be working with the Senate sponsor to reduce the number of items in the bill. You may recall, this provision was included in a bill that passed last session, but was vetoed because of so many other issues that were contained in the bill. Cancer patients have waited long enough for this exemption!
There was no action this week on SB 344 (Razer) that would change the vote to renew the city earnings taxes in Kansas City and St. Louis to every 10 years rather than the current 5 year renewal cycle and clearly exclude income earned outside the City of St. Louis from the St. Louis earnings tax. AIM supports the latter provision.
SB 96 (Koenig) originally was a minor bill dealing with certain taxing districts but, like other bills in our report, was ballooned by a committee including several provisions making it easier to obtain fuel tax refunds of the fuel tax increase we were finally able to pass after decades of hard work, as well as reductions in the corporation income tax and individual income tax rates and even a provision related to cryptocurrency mining! The bill is currently scheduled for a vote in a rules committee on Monday.
TRANSPORTATION
See SB 96 summary in the TAX section.
UTILITIES
SB 275 (Trent) was drafted by AIM and would exempt items used by electric utilities in transmitting and distributing electricity to consumers from state and local sales and use taxes. The bill was perfected in the Senate this week and will must clear a vote in a fiscal committee and one more vote in the Senate before moving to the House.
SB 333 (Trent) is a bill that would allow utilities to include in rates costs for "construction work in progress" (CWIP) if building certain nuclear electricity generation facilities. AIM negotiated language that was presented to the committee as a committee substitute that would ensure the process could only be used for small modular reactors producing less than 300mw and if the facility is not finished and placed in service for any reason, the utility would be required to repay any amounts recovered through rates back to consumers through rate reductions, including interest. Renewable energy sources that were included in the original bill, were also removed in the AIM-negotiated language. The Senate Commerce, Consumer Protection, Energy and Environment Committee heard the bill two weeks ago. AIM was the only statewide business advocacy organization that supported the revised bill.
AIM opposes the House version of the CWIP bill, HB 225 (Black) because it would not provide for recovery of costs if the facility is never placed in operation and it would allow the process to be used for nuclear facilities that generate double the amount of power that would be generated by a small modular reactor. HB 225 was referred to a Senate committee this week. We will work to add the ratepayer protections in SB 333 to HB 225. AIM was the only statewide business advocacy organization to oppose the House bill.
We will continue to update you on key bills as the session progresses. Employees of AIM member businesses may contact us anytime for an update on any issue. We thank our AIM lobbyists Trent Watson, Chuck Pierce and David Overfelt for all their efforts on your behalf. We are all working hard for you.