Never Argue With A Man Who Buys Ink By The Barrel

State Rep. Ryan Silvey doesn’t want to argue with newspaper publishers, he just wants to take away the tax exemption on the ink they buy.

It’s all part of the argument over how much the state should be helping out the state’s institutions of higher education.

Gov. Jay Nixon cut more than $100 million from them in his version of the state budget, then said he would support the restoration of $40 million of that money, given to the state in the nationwide mortgage settlement.

Silvey, the House Budget Committee chairman, wants to go the extra mile and restore all higher education funding.

As he and other house budget writers cobbled money together from various funds, they found a $28 million program that provides medical services for blind people who make too much money to qualify for Medicaid.

The move sounded a little bit hasty to many members of the committee, including budget hawk and veteran budget architect Rep. Chris Kelly, D-Columbia.

While saying the program needed looking into and a means test was necessary, he said the cut went too far.

Kelly proposed taking $2 million from the Department of Economic Development and plugging it back into the program.

Silvey also chipped in. He sponsors a bill, House Bill 1835, which would do away with the state and local sales tax exemption on equipment and supplies bought by newspapers. Silvey said that would free up $4 million that could go back into fund for blind medical services.

"We have a special tax exemption for the newspaper industry," said Silvey in a news conference following his committee’s final meeting on the state budget. "The newspaper industry has been particularly vocal about the need to end corporate welfare…and I figured they should be the first in line."

Let the ink slinging begin.

"I can’t characterize the tax exemption as corporate welfare," said Doug Crews, executive director of the Missouri Press Association. "We’re not doing anything that any other industry in Missouri isn’t doing."

Newspaper publishers collect and turn over to the state sales taxes on newspaper subscriptions and single copies.

Since a 1989 Missouri Supreme Court case that ruled newspapers were a manufacturing industry and therefore eligible for the state’s tax exemption on sales tax when buying equipment for the industry, such as printing presses, ink and other manufacturing materials.

In 1998, the state legislature expanded the list of materials newspapers could purchase without having a sales tax, spelling out specifically items such as computers, toner, film and other materials used in the publishing of a newspaper.

"The state can’t have it both ways," said Crews. "We can’t be taxed on our input and our output."

Crews said if Silvey’s legislation would go through the legislature, many newspapers would be irreparably harmed.

"We are many small businesses," said Crews. "We have anywhere from 250 to 260 newspapers in the state and the vast majority of them employ very small staffs, anywhere from five to ten, all the way down to one.

And then there are the major metropolitan newspapers that employ hundreds of people. People that work in the pressrooms, people that sell advertising, people that throw the newspapers in your yards. Many people around the state depend on newspapers for their livelihoods."

Crews said he’s not sure of the fate of Silvey’s bill. It hasn’t yet received a hearing in a legislative committee.

In the Senate, most members say the idea of cutting the blind medical program out of the budget is not going to happen, so all of this may be much ado about nothing. Still, Crews said he remains vigilant as the newspapers’ main lobbyist at the State Capitol.

It’s possible that Silvey has proposed his bill, and indeed pushed the blind medical services cut, to bring the issue of funding for higher education into the public spotlight.

Indeed, when Nixon appeared at a rally for the medical services restoration in Columbia on Tuesday, Silvey issued a press statement, saying he had written the governor a letter inviting him to sit down and talk about higher education funding.