Missouri’s Great Escape

The Hancock Amendment was added to the Missouri Constitution in 1980 through a citizen-led initiative petition. Its goal was to limit government overreach by preventing the legislature from raising taxes or spending beyond a set formula tied to personal income. It also mandated tax rebates if state revenues went beyond a defined threshold.

At first glance, the amendment protects citizens from runaway taxation and reckless spending. But Missouri lawmakers have discovered a loophole so broad you could drive a truck through it. This loophole allows lawmakers to redirect public funds toward their ideological pet projects, bypassing the Hancock limits and public accountability.

The mechanism they use is deceptively simple: tax credits.

Rather than pulling money from the general revenue fund, lawmakers allow individuals and corporations to divert their tax payments upstream, before those dollars ever reach the state general fund. It’s the same process that nearly destroyed Mono Lake in California. The lake didn’t shrink because someone drained it directly; it shrank because the streams feeding it were diverted elsewhere. With no new water entering the lake, it began to evaporate.

In this analogy, Missouri’s general fund is the lake, and tax credits are the diversions that reroute the financial streams feeding it.

MoScholars, for example, is a tax credit system that enables donors to send their tax payments directly to private scholarship organizations and receive a 100% tax credit in return. This means that if you owe $500 in Missouri income tax, you can direct all that money to a scholarship fund instead, and the state will consider your taxes paid in full. These scholarship funds are then used to subsidize private and religious schools without requiring that these schools meet the same academic or accountability standards as public schools. While the MoScholars program currently has an annual cap of $75 million, lawmakers have the authority to increase or eliminate this cap at any time.

The idea of diverting funds upstream worked out so well that lawmakers have already started applying it to other right-wing ideological causes, such as pregnancy resource centers. Essentially, tax credits allow them to redirect funds from services like public schools, road repair, and Medicaid to finance their narrow ideological agendas.

Here’s the political genius of the scheme: the money never enters the general revenue pool, so it sidesteps the Hancock Amendment’s safeguards entirely. The result is a shadow funding system that operates outside public view, yet has real consequences on state resources.

If this destructive pattern continues unchecked, Missouri’s general fund will evaporate, not through mismanagement or economic hardship, but through deliberate diversion. And just like Mono Lake, the damage won’t be immediately visible. Public schools won’t collapse overnight. Hospitals won’t shutter in a single legislative session. Roads and bridges will hold up for a few years. But year by year, the waterline will recede. Budgets will tighten. Services will disappear. And Missouri’s public institutions will dry up under the heat of indifference and ideological zeal.

There’s still time to restore the tributaries, rebuild the safeguards, and ensure Missouri’s tax system serves all its people, not just those with power and ideology to protect. But that time is running out. Once the lake is gone, no one will know where the water went. The answer will be everywhere, and nowhere.

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