At its most recent meetings, the Joint Committee on Student Success unveiled its policy and funding proposals for the long awaited education spending package. The package will be amended into House Bill 2019, a placeholder bill now deemed the ‘Student Success Act’.
The committee opened its April 9 meeting with a policy overview of the proposed education investments detailed in the -6 amendment, and noted that was only half of the package. A detailed analysis can be found here.
At the April 11 meeting, the committee opened up a public hearing on the proposed Student Success Act, taking over 3.5 hours of testimony.
After months of discussion with a variety of stakeholders on a revenue package to support the investment package, the long-awaited revenue proposal (-9 amendment), the second half of the Act was introduced. As an attempt to find a middle ground between the long-discussed business activity tax and gross receipts tax, the amendment creates a hybrid gross receipts tax.
The tax plan outlined in the amendment would apply to businesses with at least $1 million in sales a tax rate of 0.49 percent, and would allow those businesses to deduct 25 percent of labor or purchase costs from other businesses to help offset pyramiding. The amendment also reduces personal income taxes by .25 percent, a proposal that will help small business owners. The goal of the revenue work is to create a predictable funding stream that produces an additional $2 billion per biennium for K-12 education to be spent on the programs defined in the -6 amendment.
While this revenue proposal was vetted through the revenue subcommittee and introduced to the full Joint Committee on Student Success, it may not be the final policy. A robust discussion is anticipated.
Contributed by: Megan Chuinard | Public Affairs Associate