Senator proposes constitutionally backed endowment to replace state taxes over decades

Senator Adam Schnelting presented Senate Joint Resolution 95 to the Special Committee on Tax Reform, proposing a constitutional amendment to establish the "Show Me Prosperity Fund," a state-managed endowment designed to produce investment earnings that could eventually replace state-imposed taxes.

Schnelting told the committee the fund would be created by a one-time appropriation (the resolution does not set a required amount), overseen by the state treasurer and audited by the state auditor. The fund would be locked from diversion — the sponsor said it could not be borrowed against or spent for other purposes — until the legislature and treasurer agreed the fund had become large enough for annual distributions to replace state taxes. The sponsor described a conservative withdrawal framework (an amendment text discussed in the hearing capped distributions at up to 3 percent in usual endowment-style practice) intended to preserve principal while using investment earnings to fund operations over time.

Members asked for numerical scenarios showing how large an initial appropriation would need to be to produce meaningful distributions within a generation, and whether the fund could be invested in vehicles such as index funds or ETFs. The senator said the amendment is intended to expand the treasurer's investment authorities for the fund so that market investments (for example, S&P 500 vehicles) would be permissible under the constitutional change, and that the power of the proposal lies in compound interest over decades rather than short-term appropriations.

Committee members raised questions about downside risk, what would happen if fund returns underperformed, and whether a future shortfall would allow the legislature to reimpose state taxes; the sponsor said the amendment includes a fallback allowing the legislature to act lawfully if the fund failed to meet obligations.

Lisa Bennett (Armour Vine) testified in support, calling the proposal straightforward and contrasting it with other tax-elimination proposals she described as misleading. There were no witnesses registered in opposition during the hearing.

The committee concluded the public hearing; the sponsor agreed to provide numerical scenarios and additional materials on assumed return rates and appropriation sizing to committee members and staff.