Takeaways
- Amendment 5 would gradually eliminate the state income tax and allow increased and/or expanded sales taxes.
- Some school districts and education advocates say there’s not enough information about how those changes will happen and worry it will create gaps in school budgets.
- Supporters of Amendment 5 say it’s meant to be revenue neutral in the short term and could help schools in the long term.
School districts and education advocates in Jackson County worry that Missouri Constitutional Amendment 5 — a proposal to gradually eliminate the state’s income tax — would endanger school budgets if approved by voters Aug. 4.
The Lee’s Summit, Kansas City Public Schools and Independence school boards have approved resolutions expressing concern about Amendment 5 and other threats to school funding.
KCPS’ statement refers to an “impending fiscal crisis” and predicts Amendment 5 will mean “a future loss of resources for public education, estimated at $1.4 billion statewide, with potentially significant consequences.”
The Lee’s Summit and Independence resolutions, which are similar to each other, oppose Amendment 5 and “its potential impact on the stability and adequacy of state and local revenues that support public education.”
A group called Parents for Missouri Public Schools — which has been active in districts including KCPS, Lee’s Summit, Independence and Blue Springs — is focused on opposing Amendment 5 over fears it will harm school funding.
Supporters of the amendment say the fear is misplaced. Rather than ending state income tax by a specific deadline, the amendment instructs legislators to phase it out as other revenue is available to replace it. It also makes it easier to increase or expand sales taxes for five years, potentially speeding up that replacement.
“I think reforming our tax policies and modernizing our tax policies in the medium and long term benefit education and public education quite a bit,” said Missouri state Rep. Bishop Davidson, a Republican from Greene County who sponsored the resolution that put Amendment 5 before voters. “In the short term, it has no effect one way or the other.”
Opponents aren’t so sure. They say that with so many details left open-ended, it’s impossible to know the impact.
As Jackson County school districts face threats to funding at the federal, state and local levels, Amendment 5 adds to uncertainty about whether politicians will protect their budgets.
“If the Missouri legislature wants the people of Missouri to trust it that much, it’s got to prove that it’s worthy of that trust,” said Kathryn Evans, a KCPS parent, recent PTA president, advocate and nonprofit strategist. “And so far, I’ve not seen it.”
How the amendment works
Elias Tsapelas, director of state budget and fiscal policy with the libertarian Show-Me Institute, said Amendment 5 uses two major tactics.
The first requires the legislature to reduce the income tax based on revenue growth. As state revenue goes up by a certain amount, the income tax rate goes down.
Without tax cuts, revenue tends to trend upward most years. Missouri has used previous increases to lower the income tax rate using revenue triggers.
But the state also faces a looming budget crunch. Last month, Missouri Auditor Scott Fitzpatrick warned that the state’s general revenue surplus is being depleted “through a combination of expenditure increases and slowing revenue growth.”
Revenue was expected to decline in fiscal year 2026, in part due to a higher-than-expected impact from capital gains tax cuts, and rise again in fiscal year 2027.
The exact revenue triggers and tax rate changes aren’t specified in the amendment and would be up to the legislature to determine. Tsapelas said lawmakers could factor in inflation when determining triggers, but Amendment 5 doesn’t require that.
Lawmakers also have the option to increase sales taxes during the next five years without voter approval, by expanding the list of goods and services that are subject to sales tax and/or by raising the rate of existing sales taxes. If lawmakers increase sales taxes, the same bill must lower income taxes at least enough to cancel out the increased revenue.
“The changes to the sales tax are essentially ways to speed up the phase out” of income taxes, Tsapelas said.
Local governments would also have to reduce their taxes — such as property or earnings taxes — to cancel out most of any increased sales tax revenue they get from legislative changes. But the amendment specifies that those tax changes can’t result in cuts to local school funding.
Different predictions from opponents and supporters
The reliance on future lawmakers’ decisions in Amendment 5 has opened the door to a wide range of predictions.
Opponents’ worst-case scenario is that general revenue from income taxes vanishes and isn’t fully replaced by increased sales tax revenue, leaving a giant hole in the state budget.
A key reference point for those worries is a March report from the Missouri Budget Project, a center-left think tank. The report estimated that the state could lose $5 billion in general revenue, resulting in schools losing about $1.4 billion, roughly a third of their state general revenue.
Lindsey Baker, research director at the Missouri Budget Project, said the report was based on an earlier version of the amendment. It has since been changed to allow lawmakers to raise sales tax rates as well as expand the categories of what is taxed. It also doesn’t give a firm deadline for lawmakers to eliminate the income tax.
But the Missouri Budget Project numbers still show up in opponents’ materials. Parents for Missouri Public Schools links to the March report and uses the numbers as the basis for a school district lookup tool that estimates potential lost funds.
Since not all state funding comes from general revenue, and schools also receive local and federal funds, the impact of even a large cut would vary wildly by school district.
Under the Missouri Budget Project estimates, Kansas City Public Schools would lose less than 1% of its overall revenue as the state income tax is phased out. Many local suburban districts would lose around 6% to 8%. The biggest losers would be rural districts that rely heavily on state funding. The projections show some could lose more than 10%, and nearly 18% in the most extreme case.
Baker said it’s difficult to update the estimates because Amendment 5 lacks detail.
The gap it leaves in the budget “could be bigger. It could be a little smaller. We don’t exactly know,” Baker said.
Amendment 5 proponents counter that the budget hole should be practically nonexistent.
The most problematic scenarios being discussed are mostly “looking at doing something very fast and abrupt, which is not something the amendment requires,” Tsapelas said.
He said lawmakers have access to the same data and can use it to accurately calibrate how quickly the income tax should go down. If dramatic sales tax increases don’t happen, the income tax would decline more gradually rather than disappear before the gap is filled, he said.
“Some people could say there will be some major misses in forecasts or something like that,” he said. “But a major hole in the budget would not be a simple forecasting error.”
Lawmakers have reason to err on the side of caution, Tsapelas said. State expenses increase due to inflation and costs that can rise even faster than inflation, such as with Medicaid.
“I can’t imagine anyone would like to create a hole in the budget,” he said, “because that creates a ton of problems across a lot of areas, not just education.”
Davidson, the amendment’s sponsor, said he’s a product of public education, thinks education policy is “vitally important” and isn’t out to harm schools.
“The bill specifically prohibits funding decreases to schools at a local level, and it specifically provides for revenue neutrality at a state level,” he said. “This is about creating a tax reform that actually encourages economic growth, and economic growth is… also really good for the services that are provided for by the state because it grows the resources of the state.”
Davidson said he thinks schools’ opposition to the bill stems from “fear tactics.”
“Those who are genuinely concerned, it’s pretty easy to explain, and they walk away less concerned,” he said. “I don’t think the education establishment is operating sincerely, to be quite honest. … In my six years of legislative experience, I have not known the education establishment to be OK with any reform except for giving them more money.”
Since the state’s education system is one of its oldest institutions, Davidson said, it can cling to old ways of doing things.
“When you’re entrenched in the status quo, I think change is something that’s always scarier than if you’re not entrenched in the status quo,” he said.
The Beacon also contacted Missouri Promise and MO Tax Relief Now, two groups promoting Amendment 5. Both referred questions to Davidson.
Unresolved questions
Some amendment opponents and other education advocates said that regardless of the intentions of the amendment, it leaves too many open questions.
The Missouri School Boards’ Association hasn’t taken a position for or against Amendment 5, but it is informing school districts and advising them on how to communicate with the public.
The association distributed a model resolution for school boards that says the amendment “raises significant questions regarding the long-term stability of Foundation Formula funding and the district’s ability to fulfill its constitutional and educational mission.”
Caitlin Whaley, senior director of advocacy, said the association has emphasized how difficult it is to predict the amendment’s impact.
“If something were to go wrong in their plan to replace the income tax with sales and services taxes, and general revenue would be heavily impacted, then that would very quickly become an impact on school districts,” Whaley said, “because there’s just not many other places in the budget where there are substantial amounts of general revenue.”
The state budget sent to the governor in 2026 allocated $15.9 billion in general revenue. About $4.8 billion of the $8.4 billion education budget came from general revenue.
Whaley said the state has incorrectly estimated revenue before, such as a larger-than-expected impact from the capital gains tax which is “contributing to some of the current fiscal pressures that we’re experiencing.”
Lottery and sports betting revenue has also fallen short of estimates, Whaley said.
“Nothing is ever perfect, and I wouldn’t expect them to be,” Whaley said. “But when you’re gambling with the education of students and the ability of schools to provide services and pay teachers, you have to be really careful that you don’t miss the mark.”
Baker said that while the proposal is intended to be revenue-neutral, Amendment 5 doesn’t mandate that.
“There is no actual legal language or legislative language that would say how the elimination of the income tax would be tied to revenue growth. There is nothing that says how many years it would take. There is nothing that says that it has to be equal or offset,” she said. “What they are saying is that their intention is to put revenue triggers in place, and that those will be adequate.”
Baker said revenue triggers can leave budget holes if they cut taxes too quickly or don’t take into account the rising costs to maintain current services — due to inflation, an aging population or the federal government shifting costs to states. She said the triggers also aren’t “responsive to new conditions,” such as a recession.
“What we have seen here in Missouri is that they don’t fully offset each other,” she said. “Very, very small growth in revenue can trigger very large cuts.”
Baker said it’s also wise to have a mix of revenue sources because they all have pros and cons.
“Relying on one revenue stream is incredibly risky,” she said. “You don’t want to put all of your eggs in one basket.”
Amber Frazier, a fellow with Missouri Parents for Public Schools and a parent in the Lee’s Summit school district, said she’s concerned about the impact of cuts if Amendment 5 results in lower school funding. Her oldest son, who has special needs, is in a continuing education program at Miller Park Center and her twins will be sophomores at Lee’s Summit North.
She’s particularly concerned about reduced staffing, which she said could lead to weaker special education services, larger class sizes and less individual attention.
“There are some kids that really need that to thrive and do the best that they can do and have the best experience and outcome in school,” she said. “Even kids that aren’t considered special needs.”
Evans, the Kansas City Public Schools parent, said she isn’t confident that the legislature supports public education.
“It’s really not as much about my KCPS student as it is about my belief that every child in our city and our state deserves an excellent public education,” she said. “We have a legislature that, frankly, seems uninterested in protecting that right, and maybe even intent on dismantling it.”
The impact of higher sales taxes
Another area of uncertainty is how the proposal would affect budgets for families and teachers. It’s hard to know whether an individual household would pay more or less in overall taxes.
The Missouri Budget Project estimates up to 80% of Missourians could see a higher overall tax burden as they pay more sales taxes.
Tsapelas cautioned against making premature predictions.
“I don’t think anyone knows how… that’s going to impact different parts of the income range because we don’t know what the sales tax could be changed to,” he said.
Judy Young, an Independence parent and PTA council president who has been working with Missouri Parents for Public Schools, said the unknowns give her pause. Without specific numbers, “there simply isn’t enough information about how this is going to impact families in order for me to feel comfortable,” she said.
In general, seniors or lower-income households who don’t pay much income tax are at higher risk of seeing any income tax reductions canceled out by higher sales taxes.
Carter Taylor, a KCPS elementary teacher and the legislative chair of the district’s teachers union, the Kansas City Federation of Teachers, said it could become even harder to stay in the profession if teachers pay more for everyday necessities.
“Even with that 5% raise that we got this year, I would not be able to afford to live here and teach here and be a part of this community if everything suddenly gets more expensive,” she said, “because most of us are already treading water.”
‘This perfect storm’
For Taylor, the converging threats to school funding feel like facing a natural disaster.
“It is like we are all staring down this perfect storm, this hurricane coming our way, and we can predict it, we know what path it’s going to take, and there’s still people who are refusing to build up the ramparts and shelter,” she said. “The only choice we have, really, is to flee.”
When schools look at Amendment 5, they’re not considering it in a vacuum but rather as part of a whirlwind of uncertainty.
“The District’s resources to educate and support students and families have been threatened and impacted by actions taken or threatened at the federal, state, county and local level,” the KCPS statement says.
The Beacon contacted eight Jackson County school districts requesting an interview or additional information about Amendment 5 and districts’ overall financial concerns. KCPS and Lee’s Summit declined to comment; Hickman Mills did not schedule an interview by the time of publication; and Independence, Center, Blue Springs and Grandview did not respond.
In a statement, the Raytown school district said it was “closely monitoring” Amendment 5.
“At this time, the full financial implications for school districts remain uncertain and will depend on future legislative actions if the amendment is approved by voters,” the statement read in part.
In neighboring Clay County, the Liberty school board also put out a statement urging residents to become educated on Amendment 5 and noting that its long-term impacts are unknown.
At an Independence school board board work session earlier this year, former Superintendent Dale Herl, then working as a financial analyst for the district, said the simultaneous uncertainty about federal, state and local funding was unique in recent memory.
“Never have I seen, during my entire career, where all three are under severe attack,” he said. “I mean that they’re in real jeopardy for seeing a significant cut.”
On the federal level, schools have experienced temporary holds on some of the funding they receive.
Whaley said that funding “is a relatively small portion of their budgets, but still meaningful.”
On the state level, the legislature underfunded the foundation formula, a framework for determining how much schools need to educate each child, for the upcoming year.
Jackson County districts also face clawbacks of property tax funding they have already spent as part of a plan to refund property owners whose taxes rose without the proper assessment procedure. The Independence and Fort Osage school districts have filed a lawsuit opposing that plan.
Some districts — particularly Kansas City Public Schools — have also spoken out against tax abatements to subsidize development that divert more money from schools than they believe is necessary.
In that context, Whaley said Amendment 5 further complicates things.
If the amendment passes, Whaley said, “I would encourage them (lawmakers) to estimate on the side of caution… rather than moving quickly and having to deal with the consequences.”
