Press Release: Gov. Nixon issues statement on Moody’s downgrading of Kansas because of fiscal experiments like Senate Bill 509
JEFFERSON CITY – Gov. Jay Nixon today raised additional concerns regarding Senate Bill 509, following this morning’s announcement by Moody’s Investors Service that Kansas’s bond rating has been downgraded.
In 2012, Kansas passed legislation creating an exemption for business income reported by “pass-through entities” such as LLCs and corporate partnerships. Senate Bill 509 proposes a similar business income exemption.
“In their rush to follow Kansas down the fiscally irresponsible path of eliminating ‘pass-through’ income for businesses, the General Assembly seems determined to put Missouri’s spotless AAA credit rating at risk,” Gov. Nixon said. “It’s time to set aside the partisan blinders and look at the evidence: fiscal experiments like Senate Bill 509 do nothing to grow the economy and in fact, cause it great harm.”
According to Moody’s: “The downgrade reflects Kansas’ relatively sluggish recovery compared with its peers, the use of non-recurring measures to balance the budget, revenue reductions (resulting from tax cuts) which have not been fully offset by recurring spending cuts, and an underfunded retirement system for which the state is not making actually required contributions.”
Currently, Missouri has a perfect AAA credit rating from all three leading credit rating agencies – Moody’s, Fitch Ratings and Standard & Poor’s.