Missouri voters reject proposal to create sovereign wealth fund
Published 11:18 pm Tuesday, November 3, 2026
|
Getting your Trinity Audio player ready...
|
Missouri voters rejected Amendment 7 on Tuesday, turning down a proposal to create a state investment fund that supporters hoped could eventually generate enough money to eliminate state taxes.
The measure would have established the Show-Me Prosperity Fund, a permanent public endowment overseen by the state treasurer. Lawmakers could have invested state money in the fund, allowing earnings to compound over generations until they were sufficient to replace revenue from state taxes.
Unlike other high-profile ballot measures proposed by the General Assembly, Amendment 7 had no major funded campaign promoting its passage.
“There are no donors behind this. There is no think tank, no lobbyist that’s going to produce it. So there’s not going to be any money for it,” Republican state Sen. Adam Schnelting told The Independent in September. “It is one of those things where folks will have to do their due diligence and go online and look it up.”
Schnelting, a Republican from St. Charles who sponsored the legislation placing Amendment 7 on the ballot, said the idea was inspired by investment accounts he created for his children.
“When we do these calculations on the power of compounding, it is enormous,” he said. “So I just thought one day, why don’t we use the power of compound interest to ensure that we provide for future generations as far as our tax revenue is concerned?”
His legislative staff estimated that an initial investment of $250 million could grow large enough in 125 years to cover the state’s expenses, assuming sufficient investment returns over that period.
“We have to be willing to say, ‘This is not about me. This is not about you. It’s not even about our children. It’s about our grandchildren, our great grandchildren, our great grandchildren and Missourians going forward for hundreds of years,’” Schnelting said during Senate debate on the proposal. “It is about us creating a new model of how we fund government operations and getting away from the old model.”
Other states have similar funds, though they operate differently from Schnelting’s proposal.
Texas’ Permanent School Fund invests revenue from land sales and oil royalties to support public education. The Alaska Permanent Fund uses oil and mineral revenues to help pay for government services and distributes some of its earnings to residents through annual dividends.
Missouri’s proposal, by contrast, would have relied on money lawmakers chose to appropriate, along with donations and other contributions.
And while many states established sovereign wealth funds during periods of prosperity, Missouri lawmakers are facing declining revenues and mounting pressure to cut spending.
“We do not have a lot of general revenue that is going to be left on the bottom line this year, and even less next year,” state Sen. Maggie Nurrenbern, a Kansas City Democrat, said during Senate debate.
The measure received support from all but eight Republicans in the legislature, while Democrats opposed it.
Critics questioned whether Missouri could afford to set aside money for a fund that could not be used for state services until its investment earnings were sufficient to replace state tax revenue.
Under the proposal, the fund’s money would have been invested in exchange-traded funds tracking the S&P 500. Withdrawals would have been prohibited until the state treasurer determined that the earnings could replace state tax revenue and lawmakers approved that determination.
Schnelting acknowledged that Missouri’s financial circumstances could make an initial investment difficult. But he argued that lawmakers could find savings in the state budget to establish the fund, or simply leave the framework in place until the state’s finances improved.
“We could revisit it in a better time if that was required of us,” he said. “But I don’t foresee it being an issue actually funding the fund with an initial one-time investment. But again, that’s all based on whether or not the voters will approve Amendment 7 at the ballot box.”
