Despite a shortened week because of the Martin Luther King Jr. holiday, we were busy in Jefferson City the last few days. Many bills have already been heard in committee, and in the coming weeks we should begin debating measures on the Senate floor. And, new bills are still being introduced, which can continue until Feb. 28.

On Wednesday, the Small Business, Insurance and Industry Committee considered Senate Bill 1, which modifies provisions relating to the Second Injury Fund (SIF). The SIF was originally created to encourage employers to hire workers with pre-existing injuries. It is funded through a surcharge on employers’ workers’ compensation insurance.

In 2005, the SIF was operating with a massive surplus, so the Legislature passed legislation capping the surcharge at 3 percent. Previously, this rate was allowed to fluctuate depending on the fiscal needs of the SIF. The 2005 measure permanently capped the rate. Just a few years later, the 2008 economic downturn hit, and as unemployment rose, workers’ compensation premiums fell, drastically reducing the amount of revenue the SIF brought in.

As has been well documented in recent years, the SIF is now nearly insolvent. According to the attorney general’s office, the total liability against the SIF, including pending claims, is more than $100 million. Countless Missourians have yet to receive their benefits, and others haven’t even had their claims considered. It’s a pressing issue.

Under SB 1, the surcharge rate that funds the SIF could be increased up to 6 percent, if approved by a specially created commission, among other provisions. This would give us more flexibility in ensuring the SIF is adequately funded. On Thursday, the committee approved the bill. It will now be added to the calendar for debate on the Senate floor.

We also considered legislation in the committee to redefine “misconduct” and “good cause” for the purposes of disqualifying applicants for unemployment benefits. Since 2008, the state of Missouri and the federal government have spent billions on unemployment. We have laws in place that define who can and can’t receive benefits, but currently those definitions are vague, at best. This has allowed many people to receive unemployment who shouldn’t have. Senate Bill 28 would clarify who can qualify for those benefits, ensuring those funds are distributed to people who truly need them.

One of the most important priorities for the General Assembly is job creation. Since the 2008 recession, thousands of Missouri families have struggled to make ends meet. Many are still out of work or underemployed. We have to encourage economic activity in the state and help businesses expand.

This week in the Ways and Means Committee, we considered legislation that would go far in helping Missouri companies grow, especially small businesses, the backbone of our economy. Senate Bill 11 would create a tax deduction for business income, beginning at 10 percent in 2013 and, once fully phased in, 50 percent by 2017. The deduction applies to all businesses that report income on individual returns, such as sole proprietorships, S corporations, limited liability corporations and limited liability partnerships. The legislation would also reduce the corporate income tax rate by 50 percent over the same period.

By reducing the tax burden on business owners, those funds can then be reinvested in job creation and expansion. Next Thursday, the committee will hold a public hearing at 8 a.m. We will take questions from the public at this meeting, so if you have any questions or concerns, I encourage you to attend.

Contact Me

I always appreciate hearing your comments, opinions, and concerns. Please feel free to contact me in Jefferson City at (573) 751-2459. You may write me at Wayne Wallingford; Missouri Senate; State Capitol; Jefferson City, Mo. 65101, or email at wayne.wallingford@senate.mo.gov or www.senate.mo.gov/wallingford.

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