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Richard Piatt Reporting"This has been coming to a head all summer and now we're here where the votes really count and the money really talks."
Battle lines are more sharply drawn today over the proposal to eliminate the food sales tax. It is Senate Republicans versus the Governor and House leadership over that piece of tax reform.
No one said tax reform was easy and this latest battle has the potential to kill the proposal to get rid of the sales tax on food. There isn't anybody against the idea of eliminating the food sales tax. In fact, there are a lot of people who are fighting to do it.
Linda Hilton, Crossroads Urban Center: "This needs to be done. We're one of the last six states that hasn't addressed this issue."
But behind the scenes at the Capitol, it is an outright struggle sorting out how to replace the money the tax brings in -- $166-million for the state budget; $36 million for cities and towns needs to be made up.
For cities, the issue might be addressed by letting them hike their sales tax on non-food items, and give them a choice on how to distribute it. But a new sticking point is the money cities borrow for projects and buildings--Revenue Bonds. Debt is paid off, partly, with food sales tax money.
Last week, two bonding firms sent a letter to the Governor and Legislative leaders raising significant legal issues that could result in substantial litigation, they say, if the sales tax on food is eliminated.
The letter gives leaders in the Senate leverage in their opposition to the bill.
Sen. John Valentine, Senate President: "We're trying to make good policy for the state. And when we see something like a bond council, saying, whoa, we just want to make sure we're doing the right thing."
But the House speaker and the Governor are adamant, insisting this issue can be resolved.
Rep. Greg Curtis, House Speaker: "If we can do it at the register, why not do it at the register. And the bottom line is, many many states don't have a sales tax on food."
