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House rejects amendment to create ‘income tax prevention’ fund from investments
Summary
Representatives debated a second‑reading amendment to Senate File 70 that would have created a generational “income tax prevention” account funded by $100 million yearly transfers from the Legislative Stabilization Reserve Account (LSRA). The amendment failed in a division vote, 22‑35.
Representative Harshman moved Second Reading Amendment No. 1 to Senate File 70, a bill on investment modernization and public funds, proposing creation of a generational account he described as an "income tax prevention account." The amendment would have directed annual transfers of $100 million for 14 years into a new account intended to let investment earnings compound and provide future deposits into the general fund.
Supporters said the amendment was a long‑term savings measure. “This is about investing in our future, investing in our children,” Representative Wiley said. Representative Feiler said the concept mirrored private saving strategies and could help prevent future income‑tax needs. Representative Campbell said it would help “ensure future generations have the opportunity to enjoy what we do.”
Opponents pushed back on process and timing. Representative Harrelson called the amendment “a huge policy change” and said it was not appropriate as a second‑reading amendment to a different bill. Representative Baer argued the proposal would regularly remove money from the Legislative Stabilization Reserve Account (LSRA) — the state’s budget reserve — and warned that doing so could be “dangerous” in downturn years. He and others said a permanent, inviolate trust would require voter approval.
Debate included repeated references to how the permanent mineral trust fund and prior investment policies were created and how revenue flows (including the LSRA and other trust accounts) interact with the school foundation program and general fund. Supporters pointed to the potential long‑term returns and legacy benefits; opponents focused on near‑term fiscal risk and the process used to introduce a large policy change.
The amendment failed on a division vote; the Speaker announced that the amendment "has not been adopted 22 to 35." Senate File 70 was then ordered read a third time.
Ending: With the amendment defeated, the underlying investment modernization bill proceeded to third reading. Lawmakers who supported the generational account signaled they intend to continue pushing the idea in other vehicles or future sessions.
