January 17, 2018 - Scandal Rocks the State by Missouri Times

The Missouri Times

JANUARY 17, 2018

STATE ROCKED BY GREITENS SEX SCANDAL LEGAL

REFORM

ADVANCES

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STATE OF THE STATE

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Missouri Times

OPINION

The

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Fiscal cliff is preventable BY TRACI GLEASON MISSOURI BUDGET PROJECT As the Missouri General Assembly settles into its work, and Governor Greitens prepares to deliver his second State of the State Address, an unsettling reality faces our state. The Missouri Budget Project projects that our state will face a budget shortfall of more than $240 million in fiscal year 2019. Despite intense rhetoric, decades of tax cuts have failed Missourians, and made our state’s tax structure unfair to working families. What’s more, corporate tax giveaways and loopholes have undermined Missouri’s ability to fund education, Gleason infrastructure, and other services that build strong communities. A few thoughts to keep in mind as we delve into the 2018 legislative session: Decades of tax cuts cost Missouri more than $1 billion each year. (This is in addition to the cost of tax credits). When adjusted for inflation, the real purchasing power of state GR remains lower than it was in 2008. What’s more, the need for services have increased, with more Missouri children enrolled in the K-12 system, more full-time college students in Missouri’s public college & university system, and more seniors accessing health care through Medicaid. So that purchasing power is spread even more thinly. Not only have investments in higher education declined, as have MO Rx

and home- and community-based services, but Missouri remains far below national averages in many metrics, including foster care reimbursement, eligibility for child care assistance, and public health. By nearly every measure, Missouri invests less in critical public services today than it did three decades ago. The implementation of the Senate Bill 509 tax cuts (passed in 2014) will only make matters worse. We cannot cut our way to prosperity. To build a stronger economy, with good-paying jobs that allow Missourians to provide a better future for their families, we must invest in Missourians. We can do this by: • Repealing provisions of Senate Bill 509 that have not gone into effect • Modernizing our tax code and closing loopholes, like: • Ending the timely filing giveaway for companies • Enacting the Marketplace Fairness Act & other mechanisms to respond to a changing economy • Fixing the corporate income tax apportionment hole • Implementing a new, affordable income tax structure with a state earned income tax credit (EITC) By preventing the “fiscal cliff ” of Senate Bill 509, closing loopholes and modernizing our tax structure, we can begin to build a stronger Missouri, and to create the prosperity that ALL Missourians deserve.

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TWEETS OF THE WEEK

Highlights in 140 characters or less.

Elijah Haahr @elijahhaahr Jan 10 A celebrity sighting in the #MoLeg as @crumbliss and @galifianakisz have switched places.

Chris Kelly @repckelly Has a sheriff ever been Governor of Missouri? Asking for a friend.

PHOTO OF THE WEEK

Sarah Felts @sarahfelts Agree w/ @awblackwell: Greitens didn’t deny the allegation that he led a woman into his basement, tied her up, blindfolded her, & then took a naked photo of her to use as blackmail. That’s the lede. Not the affair. #MoLeg Marshall Griffin @MarshallGReport From @gcmitts: “A #StateOfTheState address without a budget proposal is like a cheeseburger without the burger or the cheese – everything important is missing.” @EricGreitens #moleg #mogov #SOTS

HOT LIST

SEN. DOUG LIBLA

Sens. Libla and Romine led the legislative ask of AG Hawley for an investigation - as of print, 33 legislators had signed on, asking for more answers.

REP. JEAN EVANS

Just days after the second year of her first term, she became one of the most sought after national media sources for legislative response insight. Clearly they see something special in her.

@JANEDUEKER

Right after starting her own law firm, she became a leading, mustread social media voice for explaining the legal ramifications of the sex scandal report from KMOV.

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SUNDAY MORNINGS KANSAS CITY - 38 THE SPOT AT 10:00 A.M. ST. LOUIS - ABC 30 KDNL AT 11:00 A.M. SPRINGFIELD - MCN 22 AT 11:00 A.M. MID-MISSOURI - MCN 22 AT 11:00 A.M.

STREAM ONLINE AT TWMP.TV

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GREITENS fares weak on delivering promises

SCHMITT HAWLEY ASHCROFT delivers record- celebrates one- reflects on first breaking results year anniversary year as Secretary for Missouri of swearing in of State

Lobbying cooling off period What the Governor said: In our first executive order, we also slammed shut the revolving door between employees of the Governor’s office and lobbyists. The people in my office come to work knowing they will never be able to lobby our office. I urge the legislature to do the same. This goal, it seems, is only fair to say it was

The Missouri State Treasurer’s Office today released a report on Treasurer Schmitt’s record-breaking first year in office. The report, titled “Year One Report: Delivering Results for Missouri Taxpayers,” highlights Schmitt’s efforts to protect taxpayer dollars, support small businesses and empower individuals and families. Schmitt was sworn in as Missouri’s 46th State Treasurer on January 9, 2017. An online version of the report is available online at themissouritimes.com “Missouri has been and always will be an exceptional state, which is why I consider it such an incredible honor to serve in this position,” said Schmitt. “We find ourselves at an important moment in history when opportunities for innovation are everywhere. In my first year as treasurer, I have worked tirelessly to embrace that opportunity and fight for a better future for our state, and I believe we have already made significant progress in the right direction.” Key highlights from Treasurer Schmitt’s first year include: • Returned $45 million of Unclaimed Property to its rightful owners – a new Missouri record for a state treasurer in their first year (see below for more information) • Launched the MO ABLE Disability Savings Program, which quickly became a model of success for other states • Revamped the MOST 529 scholars savings program, increasing enrollment and surpassing $3 billion in assets under management • Earned $37 million of interest on the state’s investment portfolio • Grew Missouri’s economy by investing $213 million in small businesses and farms through the Linked Deposit program • Advocated for Missouri taxpayers as the

To mark the one-year anniversary of his taking office, Missouri Attorney General Josh Hawley today recognized the achievements of the past year. “Since taking office one year ago, my Office has vigorously defended the rights, safety, and well-being of Missourians,” Hawley said. “I am proud of the work we have done to fight public corruption at all levels, increase transparency, remove regulations that harm Missouri farmers, investigate companies that defraud consumers, and prosecute those who harm Missouri’s vulnerable citizens. There is still much work to be done—and I look forward to continuing to serve the great people of this State.” Among many accomplishments, in 2017, the Missouri Attorney General’s Office: • Launched an investigation into whether Google has violated the Missouri Merchandising Practices Act—Missouri’s principal consumer-protection statute— and Missouri’s Antitrust laws. • Filed a lawsuit against Purdue Pharma, Endo Health Solutions, and Janssen Pharmaceuticals, alleging that these companies carried out a complex, multi-year campaign in which they deliberately misrepresented the addictive risks of opioids. The AGO also launched related investigations into seven other opioid manufacturers and three major opioid distributors. • Issued innovative new regulations, the first of their kind in the country, that would impose strict penalties on human trafficking under Missouri’s consumer-protection laws. • Launched an initiative to combat human trafficking in Missouri which included forming an anti-trafficking task force, anti-trafficking enforcement unit, the Business Council Against Human Trafficking, and an investigation into Backpage.com. • Spearheaded the largest anti-trafficking raid in Missouri history targeting busi-

Today marks one year since the inauguration of Jay Ashcroft to the Office of Missouri Secretary of State. The Office includes the following divisions: Administrative Rules, Business Services, Communications/Publications, Elections, Fiscal, Human Resources and Facilities, Securities, State Archives, State Library and Wolfner Library. “This first year has been productive, and I am honored to serve Missourians as their Secretary of State,” Ashcroft said. “We implemented new voting requirements that help protect the integrity and security of our elections and have expanded ballot access to registered Missouri voters. We worked with state and federal officials to enhance the Safe at Home program, and are offering legislation to create additional safeguards for victims and their families. “I was not elected to sit behind a desk, but rather to serve the great people of this state by being accessible, willing to listen, and ready to lead,” Ashcroft said. “No public official can be effective without listening to the people of Missouri. It’s been a humbling experience visiting people all across the state, hearing stories and gaining a better understanding of their concerns about our state and country.” In his first year in statewide office, Ashcroft traveled the state extensively, listening and answering questions from Missourians in all 114 counties. Ashcroft holds leadership roles in the National Association of Secretaries of State (NASS), co-chairing the State Heritage Committee, and serving on the Elections, Business Services, International Relations, Securities and Voter Participation Committees. He is also a Fellow in the prestigious, bipartisan HuntKean Leadership Fellowship program. Following are some of the Office’s accomplishments in 2017.

READ MORE AT THEMISSOURITIMES.COM

by Ben Peters

benjamin@themissouritimes.com

One year has passed since Republican Governor Eric Greitens assumed the mantle of the top executive in the Show-Me State and delivered his first State of the State address. Taking over the reins from former Democratic Gov. Jay Nixon, the newcomer delivered a rousing round of promises to Missourians, echoing the very campaign he ran on. Our goal is to take a look at those promises and evaluate whether the Governor’s goals reached fruition or still seek to cross the finish line. You can read the full State of the State address from last year here. ETHICS Ban on lobbyist gifts What the Governor said: “Last week, I signed an executive order banning gifts from lobbyists to state employees of the executive branch. I think all elected officials should do the same.” Greitens has continuously pushed a campaign of ethics reform in the State Capitol, and it seemed that, following the House’s passage of a bill banning most lobbyist gifts to elected officials just hours before Greitens’ first address, that such a lofty goal could be within grasp. But the measure stalled in the Senate, along with other ethics reform proposals, leaving this promise on the side of the road in the first year.

Voter ID Implementation/ShowIt2Vote Months before the voter ID law went into

ONE YEAR LATER

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IS THE TAPE REAL?

Greitens’ former mistress confirms through lawyer statement by Rachael Dunn

rachael@themissouritimes.com

Rumors concerning the extramarital affair and alleged blackmailing of a married woman by Gov. Eric Greitens continue to spread across the state and nation like wildfire less than 48 hours after the report was issued by KMOV. And the key piece of evidence that seems to matter in the conversation is a recorded conversation between the woman and her now-exhusband. Some are questioning the authenticity of the tape, asking whether it really is the voice of the woman who has been identified in the claims. Neither the Governor nor his criminal lawyer has said that was the woman on the tape. Her husband said it was her,” host Scott Faughn said on the latest taping of This Week in Missouri Politics. “ If that tape is verified, I guess the Governor isn’t saying she’s lying.” “That and that’s sort of where this lies. No pun intended,” Jane Dueker responded. “Either the tape was made up… the other option, it was her on the tape and she was lying. Only she can say whether what she said to her husband is true or it’s not true. Those are facts.” But how can we truly know? In court, the authenticity of an audio recording may be called into question, meaning that it would be up to the forensic audio experts to determine whether the evidence has been altered by confirming the integrity of the recording. The job of a forensic audio expert usually consists of three parts: enhancing the tape to make the voices more easily heard, looking to see if the tapes have been tampered with, and identifying the voices in the recording. The first part has no effect in proving authenticity. The others, however, play every part. To catch tampering in an audio file, audio experts would look for signs of alteration, like abrupt changes in the ambiance, examining the file to look for the constant hum that is created by the electrical grid. They also evaluate the volume and tone of the voice, looking for technical details like an unnatural waveform in the audio.

But the other part of the process may be the one that is more important to those doubting the validity of the recording. “If the tape is wrong – and there’s two people we know of that know this woman intimately – her husband and the Governor of the State of Missouri,” Faughn said. “Her husband says it is. The Governor’s criminal defense lawyer has said it’s not. If it’s true, there are ways you can verify the tape.” “There are ways,” Rep. Kathy Swann said. “ There’s voice recognition.”

provide that recording, along with the original recording, to a forensic expert and verify whether the voices match. If, however, a file were readily available, all that would need to occur is for the examiners to take the recording in question, as well as a recording of the known person’s voice, and compare the two files using three tests: a spectrograph analysis, an average pitch analysis, and a statistical analysis, which involves a database of millions of voices. One the two samples are run through the

Voice identification does indeed to be the most likely answer to proving whether the recording is truly of the woman in question, but the first component needed for that is an example to compare the file against. As the woman has not come forward, and her identity has not been revealed, at least not to the public, that would be a nearly impossible feat to manage. In theory, if someone has knowledge of the woman in question, then all one would need is to record her speaking and

program, examiners are given a percentage from 0 to 100 evaluating the likelihood that the voices are the same. Examiners also might use their judgment to compare the accents, syntax and breathing patterns of the person. Using such methods, the expert would listen for the speaker’s choice of words, structure sentence, usage of “um” or “like” or even speech difficulties – which when all combined together is called the idiolect – a person’s specific and individual way of talking.

An example of how this all might be used is to look back at the Trayvon Martin case in 2012 when forensic experts analyzed the recording of a phone call to police by George Zimmerman. They attempted to determine whether a scream in the background came from Zimmerman or Martin. Zimmerman told police he had fired in self-defense. In an analysis by the Orlando Sentinel, the scream was a just 48 percent match to Zimmerman, and the analyst determined it could not have been made by Zimmerman. Another example of how voice recognition is used would be when experts from around the world tried to identify the masked terrorist known as Jihadi John who was shown in the video-captured beheading of journalist James Foley. Even with all of this technology, that doesn’t mean that courts take these analyses as definitive proof. They’re often open to challenges on both the grounds of the methods used and reliability. In truth, the scientific community has explicitly discredited some voice analysis techniques and is still far from reaching a consensus on what the most effective method for identifying voices is. The Scientific Working Group on Digital Evidence, led by representatives from the U.S. Secret Service and the FBI, provides peer-reviewed guidelines for audio and video forensics engineers, and the Secret Service is calling for standards that all audio forensics labs must meet. The quickest way, however, stills remains this: the woman could come forward and confirm that the voice on the recording is, in fact, hers. That finally came about Friday afternoon, when the law firm representing the woman, Knight & Simpson, issued a press release, which stated that “it is very disappointing that her ex-husband betrayed her confidence by secretly, and without her knowledge, recording a private and deeply personal conversation and then subsequently released the recording to the media without her consent.”

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Greitens’ attorney calls story a ‘political hit piece,’ Temple responds by Ben Peters

benjamin@themissouritimes.com

As new details and allegations continue to emerge regarding the extramarital affair of Gov. Eric Greitens, more names continue to also emerge. One of the most recent names thrown into the mix is that of Roy Temple, the former chairman of the Missouri Democratic Party. Temple has been cited as a source for some of the recent information that has made headlines, reportedly having met with the woman’s

on Thursday named Temple as one of the sources for the husband’s claims that Greitens had allegedly slapped the woman against her will after she told Greitens that she had slept with her husband. That claim was denied by Greitens’ attorney, who called the report a “political hit piece.” “We have been asked repeatedly by reputable news outlets why we believe this nearly three-year-old news story is coming out now. The latest reporting has finally disclosed that the reporting was being driven by a ‘source’ who is the former Democrat state party chairman and who apparently has not spoken to the person in question. This goes a long way to explaining what is going on – this is a political hit piece,” attorney Jim Bennett of Dowd Bennett said. “This is and remains an almost three-year-old private matter with no matter of public interest at stake. Eric and Sheena have worked through those issues long ago and I think that Sheena put it best: ‘We have a loving marriage and an awesome family; anything beyond that is between us and God. I want the media and those who wish to peddle gossip to stay away from me and my children.’ Now we know who has been peddling that gossip.” Following that statement, Temple posted a lengthy response on Facebook, saying he had been aware of all of the allegations that have come out since Wednesday night back in 2016. But he said he never released the details because he had “made a commitment to someone” saying he wouldn’t do so without their permission. “With that said, the basic fact of a Greitens affair was fairly widely known,” Temple said. “This story is coming to light because of a welcome shift in the terms of how these matters are being discussed publicly, not because of me or the fact that I happen to be a Democrat.” “Some may question the choices I have made in this matter. I can only say that I have tried to make the best choice available to me at the time that I was making it. I don’t believe the same can be said for the Governor.”

“We have been asked repeatedly by reputable news outlets why we believe this nearly three-year-old news story is coming out now. The latest reporting has finally disclosed that the reporting was being driven by a ‘source’ who is the former Democrat state party chairman and who apparently has not spoken to the person in question. This goes a

long way to explaining what is going on – this is a political hit piece,” attorney Jim Bennett of Dowd Bennett said. former husband in 2016, most likely for opposition research on his party’s opponent in the 2016 election. Temple has stated that the man told him then that Greitens had threatened his now-exwife, but was not willing to go on the record with the claims because of their children. A report by Talking Points Memo issued

Senators sign letter to AG Hawley requesting investigation, tax REACTION reform tour cancelled, CA Gardner announces investigation

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Governor outlines priorities, leaves out the budget by Alisha Shurr

alisha@themissouritimes.com

In his second State of the State address, the Governor of Missouri promised to continue fighting for the people of Missouri. Speaking to a room packed with state Senators and Representatives, Gov. Eric Greitens mostly stuck to traditional Republican talking points, promising to cut regulations, decrease the size of the government, create job and — of course — cut taxes. There was no mention of the budget for the second year in a row, an item normally seen as a centerfold to the speech. Greitens once again talked of supporting veterans and police officers, ethics reform and foster care. “With your help, we will lower taxes for working families and make it easier for businesses to come to Missouri and create jobs,” Greitens said on Wednesday night. “And we will do it in a way that is fiscally sound, maintains sour state’s triple-A credit rating, and does not burden our children with debt.” Early next week, the governor will lay out a detailed plan on taxes. Greitens said that it will be “the boldest state tax reform in America.” Greitens blasted over regulation, citing that the states regulatory requirements grew at a faster rate than federally since 2002. According to Greitens, outdated regulations “waste money, waste time” and are “like plaque in the arteries of Missouri’s economy.” “Because of this, we launched the most aggressive, most thorough, most ambitious effort to roll back unnecessary regulations in the United States,” Greitens said. “By taking a strong, thoughtful, conservative approach to government, we can tell you tonight that we are taking nearly one out of every three reg-

ulatory requirements in the state of Missouri — that’s 33,000 regulatory requirements — off the books for good.” The governor has also spent much of the last year working to shrink the size of government so that the state of Missouri is operating at its smallest level in the past two decades. “Today, I’m proud to tell you that we continue to shrink the size of government,” the governor said, citing several cost saving efforts that have been made. “We promised we’d fight for your jobs, and we are,” Greitens said. “The most important thing we can do for Missouri families is to make it easier for those without jobs to find them and make sure that those who have jobs keep them. Over the past year, we have devoted the energy and attention of our office to putting Missourians back to work.” Missouri has the lowest unemployment rate it’s had in 17 years. Since last March, the state has outpaced the nation in job growth. “We have a lot of work left to do,” Greitens said after recognizing that many in the state still struggle. Greitens once again called for a lobbyist gift ban to be passed in the legislature. A bill is moving through the House and could be sent to the sent as early as next week. “In the meantime, I have a simple request: I call on every member of the legislature to join me in a pledge not to accept any gift from lobbyists.” The governor called on the General Assembly to pass a bill allowing employers to establish a veterans’ hiring preference. “Right now, in the state of Missouri, a small business owner who declares that he or she wants to hire veterans can be sued,” Greitens said. “That’s wrong.”

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State of the State 2018

“I believe the Governor did a terrific job sharing with Missourians the positive steps our state has taken to grow quality jobs, and I’m proud of the work done by the General Assembly to foster economic growth,” Speaker of the House Todd Richardson, R-Poplar Bluff, said. “The House has a strong desire to work on tax reform that reduces the burden for working families and I look forward to the Governor laying out his plan in the coming weeks. With the positive response we have seen to the passage of the recent federal tax reform legislation, we are confident Missouri will see the same positive reception for tax reform on the state level.”

“Democrats believe government should work for all Missourians to maximize opportunities and provide support for individuals and families who work hard and play by the rules. But the rules set by state government must be fair and apply equally to all Missourians,” House Minority Leader Gail McCann Beatty said in the Democrats’ response. “When there is one set of rules for most Missourians and another, more favorable, set of rules for those who can afford to hire lobbyists and make big campaign contributions, it erodes Missourians’ confidence that they will get a fair shake. Governor Greitens markets himself as a political outsider dedicated to cleaning up state government. During his first year in office, however, Governor Greitens’ administration has been stained by ethical failings, disdain for the law and a complete lack of transparency.”

“Missouri’s economic trajectory has risen since Gov. Eric Greitens took office last year. The General Assembly can help sustain this success by following last year’s productive legislative session with a continued effort toward meaningful state tax reform,” said Daniel P. Mehan, Missouri Chamber President and CEO. “Missouri’s inconsistent tax structure has been a frustrating impediment to business growth for far too long. On behalf of our state’s business community, I would like to thank Gov. Greitens for making tax reform a priority. We will work with the General Assembly to advocate for this becoming a reality in 2018.”

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RESPONSE

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Emery’s utility legislation is back

Bill has new provisions, opposition remains the same by Benjamin Peters

benjamin@themissouritimes.com

JEFFERSON CITY, Mo. – Utilities are once again pressing forward in the legislature, asking the state’s lawmakers to take a serious look at grid modernization measures in the Show-Me State. The Senate Committee on Commerce, Consumer Protection, Energy and the Environment heard testimony on Sen. Ed Emery’s SB 564 on Wednesday afternoon, which lasted more than three hours with an equal number of opponents and supporters of the bill. The bill echoes pieces and parts of Emery’s previous energy bill, filed during the 2017 legislative session, SB 190, though the bill’s language seems to have been reduced or simplified from more than 60 pages to the 16 pages of the current version. “SB 564 is not completely unlike last year’s bill,” Emery said while presenting the bill before the committee. “Effectively, it’s only about a dozen pages which should make it easier to digest.” The intent of the bill, as in previous years, has been to encourage utility providers to upgrade their power grids. He cited the results in other states, noting that in the neighboring state of Illinois, the state saw reduced electricity costs thanks to a modernized gri“Grid modernization is still the objective here,” Emery said. “In those states, grid modernization resulted in rate reductions.” Emery explained that the latest bill took some of the ideas formed during the interim

and that 12 sections had been removed from the bill. Now, the bill includes about eight different components. The first seeks to make rate adjustments outside of the general rate proceedings held by the Missouri Public Service Commission, allowing corporations to amend existing rate schedules and being their rate recovery without filing a general rate proceeding. Sen. Jamilah Nasheed questioned that provision right from the start of the hearing. “Why shouldn’t they have to go before the PSC?” she asked, to which Emery explained it would be part of the recovery of the fuel adjustment clause. “All this does is add these elements back in, that was there before,” Emery said, citing a change in recent years. The second component simply seeks to clarify the complaint procedure against utility under the PSC’s statutes, which Emery said was something the chairman of the commission had asked for. It also includes a provision allowing the corporations to defer any differences in state and local property tax expenses incurred, a provision for plant-in-service accounting, and requires a 5-year-capital investment plan for the furthering of replacing, modernizing, and securing its infrastructure. It also includes a provision for discounted electric rates for certain qualifying customers, and requires a contractor “pre-qualification process.” But the newest provision, which has been

called for by a number of organizations, is the rate caps to tbe put on utilities. Sen. Gary Romine was staunch in his opposition, as he has been throughout past hearings regarding proposed changes to rate-making mechanisms, and on the issue of the rate caps, he had plenty to say. “The rate caps are not hard caps,” he noted. But he also added that some of the letters encouraging those provisions were not taken through the proper processes of the respective organizations. “I’m frustrated with some of the efforts,” he said. “Shaul should never have sent that letter out.” As dozens rose to testify on the issue, it became apparent that, just like in years past, the issue will prove to be a hot one. Speaking on behalf of the Missouri Energy Development Association, Trey Davis noted the demand for a modernized grid, saying the bill would address a number of key areas for ratepayers: cost, reliability and resiliency, economic development, and security. Sen. Nasheed might have summed up some of the sentiments of most supporters in the room, saying that they could not “kick the can down the road” again. “Times have changed,” she said. “We’re talking about a 100-year-old grid, and the usage we see today is totally different from the usage of 30 years ago. We have to do something to make it right.” She told Davis that she did not agree with everything in the bill, but agreed with the need to do something.

“Do you support all provisions of the bill, or just portions of it?” she asked him. Davis says they approve of the entire bill, but also stated that they had no delusions that the bill’s language would stay as it is throughout the entire legislative process. “We continue to do the status quo, every rate case, every 11 months,” Davis said. “This is the time to talk about it. If you want to find a better way, or a better scenario, then this can start that conversation.” Speaking in opposition, David Woodsmall of Midwest Energy Consumers Group (MECG) said the bill is not balanced and was a “tremendous step backward from last year’s bill.” He contended that the prior bill had sought to give the PSC more discretion, and said the new version would give the utilities more power and the ability to do as they wanted with little PSC discretion. This bill creates a deferral mechanism,” he said. “Everyone has to manage costs - except for utilities. They are currently allowed to defer several costs, and this bill just adds to the list of things that can be deferred.” Sen. Dave Schatz, however, may have spoken for everyone during the hearing, with some of the most poignant comments. “I’d love to make the utilities happy, but my concern is for the ratepayers,” he said. “I would like to see that from every utility - where they have lowered the water instead of raising the bridge.” “Sen. Schatz, you just made the best argument I’ve heard today for performance-based rate-making,” Sen. Emery said.

Is the third time the charm? Fitzpatrick’s bill limiting unemployment benefits back in House by Alisha Shurr

alisha@themissouritimes.com

JEFFERSON CITY, Mo. — Third time’s a charm? Well, Missourians will find out this legislative session with a bill aimed at changing the laws regarding unemployment compensation. “Missouri is the only state that has habitually run out of money in its unemployment trust fund,” Rep. Scott Fitzpatrick, R-Shell Knob, the bill’s sponsor, said. The bill — introduced into the Missouri House of Representatives for the third time — would tie the duration of unemployment benefits to the state’s average unemployment rate on a sliding scale. “It makes sense when it’s easier to get a job, unemployment benefits don’t last as long,” Fitz-

patrick said, “and when it’s hard to get a job, benefits last longer.” Under the bill, if Missouri’s average unemployment rate is below 6 percent, benefits will last 13 weeks. If the rate is 9 percent or higher, benefits will last 20 weeks. In between those rates, the eligibility period drops one week for each half percent change in the jobless rate. “We would be the second lowest in the country for benefits,” Rep. Doug Beck, D-St. Louis, said. Only Florida would be listed lower if the bill becomes law. Beck cited that most states have 26 weeks of benefits. Fitzpatrick argued that it’s easier to qualify for jobless benefits in Missouri and that those states have more strict criteria. Others on the committee point out that unemployment rates differ from city to city and

between each county. “This is a one size fits all bill,” Rep. Jim Hansen, R-Frankford, said, “and I don’t think it is a one size fits all issue.” The bill is aimed at making the unemployment trust fund more solvent, according to Fitzpatrick. “This is the wrong way to go,” Beck stated. “It is frustrating to see the constant bashing of workers in the state.” If the arguments seem familiar, that’s because they are. The statement’s made in Tuesday’s Special Committee on Employment Security hearing eco those made in previous years — almost verbatim. In 2015, the bill passed the House and Senate but was vetoed by then-Governor Jay Nixon. The House voted to override the veto in

regular session and the Senate voted to override the veto in a later session. The bill was actually in effect for a portion of 2016, until it the Senate’s veto override was struck down by the Missouri Supreme Court. Re-introduced in 2017, the bill passed the Missouri House but stalled in the Senate. HB 1409 — the current draft of the legislation — would also allow for employers to recover overpayment due to an erroneous experience rating, raise the amount required in the Unemployment Compensation Fund before an employer’s contribution rate is decreased, modifies procedures for the Board of Unemployment Fund Financing to meet and consider the issuance of credit instruments, and modifies the time employers shall pay the interest assessment on credit instruments.

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Dogan’s hair braiding bill gets off to a quick start by Benjamin Peters

benjamin@themissouritimes.com

JEFFERSON CITY, Mo. – Rep. Shamed Dogan watched in 2017 as the bill he sponsored fell to the wayside of the Senate in 2017, despite his efforts to move the Hair Braiding Freedom Act through his chamber with an impressive 137-10 vote. Just days into the 2018 legislative session and Dogan is back at it again, and this time, his bill is getting some expedited treatment, as it was referred and passed through two committees on Monday. HB 1500, virtually identical to Dogan’s HB 230 from 2017, seeks to allow hair braiders to do their work without requiring a cosmetology license, and instead simply requiring them to register with the State Board of Cosmetology and Barber Examiners. “This bill has gone through the ringer,” Rep. Dogan told his colleagues on Monday, noting that the same committee had spent hours on the bill in the previous session. He explained that it was the same bill, and shared with his fellow House members his thoughts on how the bill was an “important step for economic freedom.” The House Committee on Professional Registration and Licensing spent far less time on the bill Monday afternoon, roughly an hour on the issue. Only a handful of members testified on the bill, most noting that their stance was similar to that of last year. However, the committee did attach two amendments to the bill before signing off on the legislation. An amendment by Rep. DaRon McGee added “human trafficking” to the list of offenses that would bar an applicant from receiving a license to practice, while Rep. Diane Franklin moved to add a video component in addition to a brochure to provide information on disease and conditions that applicants needed to learn to identify to pass the required test. The committee voted the bill do-pass with a 9-0 vote, where it then went to the House Rules Committee on Administrative Oversight where the bill advanced again with an 11-1 vote. The bill now sits on the perfection calendar in the House.

House Litigation Reform Committee hears DeGroot’s interpleading bill by Benjamin Peters

benjamin@themissouritimes.com

JEFFERSON CITY, Mo. – Should the state change up the rules regarding its statutes on interpleaders? That seems to be intent on one bill heard early Tuesday morning. The House’s Special Committee on Litigation Reform met Tuesday morning to hear Rep. Bruce DeGroot’s HB 1531, a bill seeking to “modify provisions relating to interpleading in civil proceedings.” An interpleader is a civil procedure which allows a plaintiff or defendant to initiate a lawsuit in order to compel two or more other parties to litigate a dispute. This occurs when the plaintiff holds property or money on behalf of another but does not know to whom the assets should be transferred. Translation: it’s a legal remedy used when two or more parties seek ownership of money or property held by a third party. The bill says that a plaintiff ’s insured may be joined as a defendant and required to interplead when the plaintiff could be exposed to multiple claims against the same insurance coverage. In addition to this, the bill would set up a procedure as to how an insurer might deposit “all applicable limits of coverage” into the court in an interpleader, and would not be liable for further coverage beyond that of its contractual limits “so long as the insurer defends its insured from any further claim or lawsuit. “Section 507.060 has been abused for a long time by plaintiff ’s attorneys, sometimes, not always, and what this bill looks to fix that,” DeGroot said. DeGroot explained that, in the scenario in which a person had a car accident, and there were multiple people in the other vehicle, an insured person’s policy would cover up to a specified amount of money. If the injuries of the other vehicle added up to more than that specific amount of money, the insurance company, under the current statute, would interplead the funds with the court, but “still are subject to a bad faith claim.” “If we have insurance carriers with $100,000 policies that are on the hook for $14 million, well everybody pays for that,” DeGroot said. “We all get an increased premium.” He also stated that such an environment has a negative effect on companies, saying it made

them “not want to do business in the state of Missouri.” “It leads to a general overall unfair climate,” DeGroot said. Testifying alongside Rep. DeGroot was Clay Crawford, an attorney out of Kansas City. “Almost all states have statutes for interpleaders,” Crawford said. He explained that what makes Missouri unique is that the under current law, as he told the committee, by merely interpleading their funds, insurance providers can be exposed to claims of bad faith. Crawford told the committee that the amendment to interpleader statute would allow companies to take advantage of the interpleader “without being exposed to themselves to millions of dollars in liabilities in excess of their contractual liability.” He contended that the current statutes sometimes put insurance carriers in impossible situations where they would have to choose to pay out claims on a first-come, first-served basis and exhaust their policy limits to avoid bad faith claims. “It would allow for fair allocation of limited liability proceeds among people with claims and avoid the gamesmanship and races to the courthouse or law offices,” Crawford said. “When you have these claimants and their lawyers jockeying for position to try and maximize their recoveries, it results in long delays and unfair allocations of limited insurance proceeds.” Rep. Mark Ellebracht expressed concern that the bill might extinguish the insurance provider’s duty to defend, or “dump and run.” Rep. Gina Mitten shared the same concerns, and asked if DeGroot would be amenable to an amendment to the bill, since the language was “meant to prohibit a dump and run.” She said that the language seemed to create some confusion. She also noted that different states handled interpleaders differently. She spoke to concerns about lawyers not having incentive to mount a strong defense. “There’s already a lot of pressure on the defense counsel to keep things cheap,” she said. “As to the concerns of exposing them to multimillion dollar liabilities, they’re already exposed to that.” “We don’t expect these things to happen. No reasonable person buys a million dollar policy expecting to hit some black ice in my lifetime,” Mitten said. Crawford responded, saying that the natural market forces and the cost of engaging an inter-

pleader would encourage carriers to settle when they can, and said: “woe be the lawyer who takes a case with a third party payer and doesn’t do everything professionally necessary to provide a quality representation of their client.” While Crawford spent a good portion of the hearing fielding questions, others testified against the bill, citing similar concerns to those shared by Ellebracht and Mitten. “It looks like the intent of the bill is to absolve the insurance company of its duty to obtain a release,” David Zevan, President of the Missouri Association of Trial Attorneys said. “They’re not obtaining a release for the money, so they have a duty to indemnify and defend. When they put that money in, they’re saying ‘we’re going to continue to defend you, but we have put the money in the court.’ But they haven’t obtained a release for that, they’re still liable above and beyond that $50,000. You’ve exonerated your own liability, but you’ve still exposed me to liability.” Zevan says that there are plenty of fine lawyers out there in those types of roles, but says he has little faith that they will do everything they can possibly do because an insurance company could be telling them how much they can spend and what they can’t spend. “They might not be acting in my best interest, but who cares anymore? They have no incentive,” Zevan said. “Why can’t the company turn to its own insured and say ‘Hey, you only have $50,000 in insurance. We could continue to defend you, you might get hit for more than this $50,000, so why don’t we see if we can offer up the $50,000 and get a release from all of these people? What if we did that for you?’ Then they’re simply doing their jobs. Unfortunately, the system works as it does now, and holds insurance companies accountable. I don’t know why we want to let them walk over their insured.” He calls it, quite simply, a way for companies to increase their profits. Rich Aubuchon, a lobbyist representing Property Casualty Insurers Association of America also testified, summing up their sentiment in a few sentences. “We believe this strikes a good balance that allows the insured to receive what they paid for and also that they get a good, vigorous defense,” Aubuchon said. “It’s a good balance.” At the end of the hearing, the committee adjourned, taking no action on the bill.

Anti-human trafficking legislation advancing by Alisha Shurr

alisha@themissouritimes.com

JEFFERSON CITY, Mo — An anti-human trafficking bill soars through committee after an emotion-packed hearing and is now in the House. A drove of supporters turned out to give testimony to the House Committee on Crime Prevention and Public Safety. “I was raped, I was beaten,” Casey Alvarez,

co-founder of Go61, said. “There was not one person who identified me as a victim. There was not one opportunity I could see that was an offer of help.” House Bill 1246 — sponsored by Rep. Patricia Pike, R-Adrian — would require various establishments to display a poster that provides information regarding human trafficking, including what it is and what resources victims have for getting help, in a conspicuous place near the front

of the establishment, starting March 1, 2019. Missouri ranks in the top 20 of states in human trafficking, or “modern day slavery” as it was referred to several times throughout the hearing. “Since 2007, the National Human Trafficking Hotline has received nearly 2,000 reports of human trafficking cases right here in Missouri,” a representative from the state Attorney General’s office said, “and it has identified as many as 1,000 possible victims in our state.”

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DHSS says statewide PDMP is up and running by Alisha Shurr

alisha@themissouritimes.com

Withdrawing from NAFTA could be a ‘catastrophe’ for Missouri by Alisha Shurr

alisha@themissouritimes.com

With NAFTA talks looming, agriculture leaders are saying Missouri could be one of the hardest hit states should the United States withdraw from the North American Free Trade Agreement. “Losing NAFTA would be a catastrophe,” Chris Chinn, the director of the Missouri Department of Agriculture, said in a forum last February. Last week, six Republican Senators — Missouri’s U.S. Sen. Roy Blunt, as well as U.S. Sens. Cory Gardner, John Howeven, Pat Roberts, Dan Sullivan and John Thune — met with President Donald Trump to advocate for preserving NAFTA, according to the National Pork Producers Council. “A primary discussion point was the negative impact a withdrawal would have on economic and stock market momentum,” the NPPC report said. The sixth round of NAFTA talks is set for Jan. 23 in Montreal. CNN reported that Canada is preparing for the U.S. to withdraw from the trade pact.

According to the Chamber of Commerce of the United States, more than 250,000 jobs in the state depend on trade with Canada and Mexico. More than half — 56 percent — of Missouri’s exports are bound for Canada and Mexico, generating $7.8 billion in export revenue. “NAFTA has led to tremendous growth in U.S. trade with Mexico and Canada, integrated cross-border supply chains that benefit U.S. employers, and more than tripled U.S. exports of goods (including agricultural and manufactured goods) and services,” a letter signed by Sen. Blunt stated in May. “Given that the agreement is more than two decades old, there are areas in which NAFTA will benefit from strengthening and modernization. On the other hand, efforts to abandon the agreement or impose unnecessary restrictions on trade with our North American partners will have devastating economic consequences.” Ninety-three percent of Missouri’s motor vehicles and 87 percent of the state’s aluminum is exported to Canada and Mexico. Withdrawing from the trade pact would also hit Missouri’s farmers and ranchers. “NAFTA has a huge impact on Missouri agriculture,” Chinn told the High Plains Journal.

In 2015, the state exported $928 million work of agricultural products. Out of Missouri’s $2.2 billion total agricultural exports, Mexico and Canada are the No. 1 and No. 2 markets, respectively. Over half of the state’s soybeans are exported, with Mexico being the second largest market. Soybeans topped Missouri’s agricultural commodities in 2016, and at 181 million brushes produces the ninth most in the country. “We need to make sure that these trade agreements stay in place,” Chinn said. If the U.S. abandons NAFTA, Mexican tariffs would rise 10 percent on pork — Missouri’s fourth top agricultural commodity in 2016 — and 25 percent for beef — the state’s third ranked agricultural commodity. “Since 1994, U.S. corn exports have increased more than seven-fold to #NAFTA partners,” the Missouri Corn Growers posted to Facebook in May. “NPPC continues to urge the Trump administration to remain committed to NAFTA and to maintain zero-duty market access for pork exports to Canada and Mexico,” said NPPC. “A U.S. withdrawal from NAFTA would cost the U.S. pork industry $1.5 billion.”

JEFFERSON CITY, Mo. — Missouri’s statewide prescription drug monitoring program is up and running. Dr. Randall Williams, Director of the Missouri Department of Health and Senior Services, confirmed in a public health meeting that the program has been active since the last week in November. “We meet once a week,” Williams said. “Since we are an investigative body, I don’t want to give too many specifics.” The program — created by Gov. Eric Greitens through executive order last summer — is aimed at reducing the opioid crisis in the state by identifying prescribers who help fuel prescription painkiller abuse. “We can pull up a spreadsheet and see all the prescriptions in the state,” Williams said. “That enables us to go, ‘wait a minute, why in the world is that doctor writing that many prescriptions.’ They may not be doing anything wrong, but it is highly suspicious.” Instances of wrongdoing are either referred to the Drug Enforcement Agency or Missouri Board of Registration for the Healing Arts depending on the case. Express Scripts, one of the nation’s largest pharmacy benefit management firms, is providing the state with the prescription data — voluntarily and free. Express Scripts provides Missouri with the prescriber’s name, pharmacy name, and drug name and strength amongst other relevant data. No patient information is given. Mallinckrodt Pharmaceuticals, based in St. Louis, has also been instrumental in encouraging elected officials throughout the state to support a statewide program over the years. The state has put out overtures to other companies like CVS and UnitedHealth for their data — again, on a voluntary basis. The Bureau of Narcotics and Dangerous Drugs within the DHSS is currently handling the program and looking over the data. “We are using our existing resources,” Williams said.

Greitens, budget leaders announce Consenus Revenue Estimate

Gov. Eric Greitens, along with Sen. Dan Brown (Senate Appropriations Committee Chairman) and Rep. Scott Fitzpatrick (House Budget Committee Chairman), announced Missouri’s Consensus Revenue Estimate for Fiscal Year 2019. The annual CRE is a figure established by state budget experts and outside consultants and is one of the basic assumptions the Gover-

nor and legislative leaders use to build and balance Missouri’s budget. “I feel the CRE is realistic and I think things are turning in Missouri,” said Brown. “However, there is always a bit of a lag in revenue growth. Missouri is open for business and growth will be on the horizon.” The key figure in the CRE is the projected general revenue collections for FY2019, which

is expected to be $9.418 billion. This represents growth of $229.3 million over the estimated revenue for FY2018. The estimate for FY2019 assumes growth of 2.5 percent. “I remain committed to maintaining a balanced budget while continuing to find ways to make a smaller government that works better for Missouri citizens,” said Greitens. “I want to thank Gov. Greitens, Sen. Brown,

and all the staff who worked to arrive at this estimate in the midst of a changing tax landscape,” Fitzpatrick said. “I look forward to continuing to partner with the Governor, Sen. Brown and my colleagues in the General Assembly to once again craft a fiscally responsible budget for our state government.” Greitens has said that the budget will be released online only this year.

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1. Schroer kicks off tanning bill with coalition of support 2. COOâ&#x20AC;&#x2122;s Task Force on Fleet Management finds more than $2 million in potential savings 3. Ellington files legislation to legalize marijuana in Missouri 4. AG Hawley announces first-ever legal expense fund annual report 5. PSC welcomes Silvey, grants CCN in ATXI transmission line case Read on these and more online at www.missouritimes.com. Email your news to pressreleases@themissouritimes.com

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Lobbyist Moves Courtesy of the Gate Way Group

Husch Blackwell, Statehouse Strategies and Cloakroom Advisors launch new government affairs joint venture by Benjamin Peters

benjamin@themissouritimes.com

In the latest news of firm mergers and ventures, powerhouse government affairs firms Statehouse Strategies and Cloakroom Advisors have announced the joining of forces with the Husch Blackwell law firm to create a new joint venture which will be called Husch Blackwell Strategies. The new lobbying and consulting firm will be headquartered in Jefferson City, combining much of Husch Blackwell’s existing government affairs team with the existing operations of Statehouse Strategies LLC and Cloakroom Advisors, LLC. “Providing clients access to the full suite of government affairs services under one roof is increasingly important in coordinating overall corporate strategy,” Husch Blackwell Chief Executive and Managing Partner Greg Smith said. “Husch Blackwell Strategies represents a natural evolution in presenting clients with a strong value proposition in what is a very competitive business.” As part of the merge, Andy Blunt, the founder and chairman of Statehouse Strategies, will join Husch Blackwell Strategies as Chairman of the Board and Chief Operating Officer, where he will focus primarily on expanding the venture’s state-level practices. “Combining the expertise of Husch Blackwell with Statehouse and Cloakroom makes good business sense and will ultimately benefit clients,” said Blunt. “This

combination will provide clients with access to a trusted advisor whose footprint covers Washington, D.C. and several key state capitals during a time when policy-making at both levels is critical to organizations.” Gregg Hartley, the founder and prin-

levels,” Hartley said. “We live in a turbulent political era, and business goals and challenges can change drastically in the blink of an eye. Husch Blackwell Strategies provides a scalable, all-in service.” Husch Blackwell partner Kyle Gilster will serve as the venture’s General Counsel, and several leading government affairs consultants and attorneys will join the venture from Husch Blackwell. “This combination marks serious growth in our team’s ability to help clients anticipate and shape the laws and regulations that affect their businesses most,” said Catherine Hanaway, former Speaker of the Missouri House and the head of Husch Blackwell’s Government Solutions team. According to a news release, Husch Blackwell Strategies’ Washington presence will be located within Husch Blackwell’s current office location and a satellite office near Capitol Hill. The firm itself will be nationally headquartered in Jefferson City, at the offices now occupied by Statehouse Strategies.

“Combining the expertise of Husch Blackwell with Statehouse and Cloakroom makes good business sense and will ultimately benefit clients,” said Andy Blunt. “This combination will provide clients with access to a trusted advisor whose footprint covers Washington, D.C. and several key state capitals during a time when policy-making at both levels is critical to organizations.” cipal of the federal lobbying firm Cloakroom Advisors LLC, will become the Executive Vice-Chair of the Board and Chief Executive Officer of Husch Blackwell Strategies and will concentrate on growing the venture’s federal practice group. “Husch Blackwell Strategies is built on the notion that clients want and need a vertically integrated approach to tactics and strategy at both the state and federal

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• The maximum amount that can be deposited over the life of the account is $25,000; the maximum total amount in the account is limited to $50,000. • Parents or grandparents can contribute to this account as well. • An amount equal to 50% of the annual contribution may be deducted from the contributor’s taxable gross income and any gain within the account would not be subject to state income taxes. • Money from the savings account would have to be used toward the purchase or construction of a first home.

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