COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.:1102H.01I Bill No.:HB 1136 Subject:Business and Commerce; State Treasurer; Banks and Financial Institutions Type:Original Date:March 21, 2025Bill Summary:This proposal establishes the "Digital Assets Authorization Act".
FISCAL SUMMARY
ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2026FY 2027FY 2028
General Revenue*
Could exceed
($214,000)(Unknown)(Unknown)
Total Estimated Net
Effect on General
Revenue
Could exceed
($214,000)(Unknown)(Unknown)
*Oversight notes that costs to implement the proposal include contracts with a third-party
vendor, updating current systems to accept payments in cryptocurrency, and additional
administrative work. Oversight assumes the cost will exceed the $250,000 threshold.
ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028
Inmate Fund (0540) *
(Unknown, could
exceed $250,000)
(Unknown, could
exceed $250,000)
(Unknown, could
exceed $250,000)
Total Estimated Net
Effect on Other State
Funds
(Unknown, could
exceed $250,000)
(Unknown, could
exceed $250,000)
(Unknown, could
exceed $250,000)
*Oversight notes the proposed legislation could have an unknown impact on the recovery of
funds used to cover some of the incarceration costs for offenders, as stipulated in the statutorily
mandated Missouri Incarceration Reimbursement Act (217.831 RsMO).
Numbers within parentheses: () indicate costs or losses. L.R. No. 1102H.01I
Bill No. HB 1136
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ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on All Federal
Funds $0$0$0
ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2026FY 2027FY 2028Total Estimated Net
Effect on FTE 000
☒ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any
of the three fiscal years after implementation of the act or at full implementation of the act.
☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of
the three fiscal years after implementation of the act or at full implementation of the act.
ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2026FY 2027FY 2028Local Government*(Unknown)(Unknown)(Unknown)
*Oversight notes there are potential costs to contract with a third-party vendor, update current
systems, and additional administrative work in order to implement the provisions of the proposal. L.R. No. 1102H.01I
Bill No. HB 1136
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FISCAL ANALYSIS
ASSUMPTION
§§362.1125-362-1125 - Digital Assets Authorization Act
Officials from the Department of Revenue (DOR) assume §362.1126 would allow digital
assets to be accepted as legal tender in Missouri and shall be allowed for the payment of all legal
goods and services. This proposal does not specify that the digital asset be minted or controlled
by the U.S. Mint or that the digital asset be a currency that is considered legal tender. Therefore,
this proposal would allow people to create their own currency.
The State and DOR already accept all coins minted by the U.S. Mint as they are considered legal
tender. This includes the commemorative coins printed but not widely used in financial
transactions. Additionally, DOR allows for the use of credit and debit cards that are based on
physical currency.
DOR receives, processes and deposits the majority of all state revenue. DOR receives sales tax,
individual income tax, corporate tax and various taxes and fees collected by state agencies that is
then brought to DOR for deposit. However, DOR does not accept and will continue to not
accept any digital asset that is in violation of 18 U.S. § 486. Acceptance of any currency form
not considered legal tender per this federal statute can result in felony charges being brought by
the Federal Government.
Missouri would be the first
states have passed laws providing their state with language allowing rolling compliance with
acceptance of currency types like these should the federal government make these types of legal
tender, have allowed the paying of a currency that is not legal tender. Therefore, DOR is
unable to obtain information as to the number of people wishing to use alternative currency or
the costs of providing these alternatives.
This proposal additionally says that a person using a digital asset to make a payment will not be
subject to any additional fee or assessment for using that method of payment.
DOR notes that currently they assess a processing fee on all e-check payments as well as all
debit and credit card payments. That is because those payments are processed for the
Department by a third-party vendor who assesses those fees. They assume this proposal would
require DOR to modify their contract to require DOR to pay the fee rather than the customer.
DOR assumes additional costs for this contract exceeding $100,000 annually.
DOR will need to update their numerous payment systems to recognize that these types of
payments were made. These would include taxation’s MyTax, and the motor vehicle and driver
license systems’ FUSION. ITSD estimates at least $38,000 for the necessary updates per
division (3 divisions x $38,000 = $114,000). L.R. No. 1102H.01I
Bill No. HB 1136
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Oversight does not have any information to the contrary. Therefore, Oversight will reflect the
estimated impact by DOR in the fiscal note.
Officials from the Department of Corrections (DOC) assume the proposal establishes the
“Digital Assets Authorization Act”.
Section 362.1125 prevents the state from “prohibiting, restricting or otherwise impairing” self-
custody of digital assets. The legislation also defines “decentralized” by stating that no single
entity (including government agencies) has unilateral control over governance, transactions, or
maintenance of the ledger.
The proposed legislation could have an unknown impact on the recovery of funds used to cover
some of the incarceration costs for offenders, as stipulated in the statutorily-mandated Missouri
Incarceration Reimbursement Act (217.831 RsMO). Self-hosted and hardware wallets would
make it nearly impossible to pursue an offender’s assets. With traditional bank accounts and
custodial crypto exchanges, there is a central or governing body that can be subpoenaed. The
proposed legislation would remove that ability. Therefore, there would be an unknown cost
anticipated to exceed $250,000 for the department.
Oversight does not have any information to the contrary. Therefore, Oversight will reflect an
unknown cost that could exceed $250,000 to DOC as well as a zero to unknown cost to the
general revenue fund and local governments in the fiscal note for the recovery of funds.
Officials from the Office of Administration - Budget and Planning (BAP) assume this
legislation will exempt digital assets used as a method of payment from capital gains tax. Digital
assets are currently subject to the capital gains tax. This would result in an unknown loss to TSR.
Oversight does not have any information to the contrary. Therefore, Oversight will reflect the
estimated impact by BAP in the fiscal note.
Oversight notes under this proposal, the state of Missouri or a municipality cannot prohibit an
individual or person from accepting digital assets as payment for goods and services; or to
maintain self-custody of a digital asset using a self-hosted wallet or hardware wallet.
Oversight assumes there could be potential costs to contract with a third party vendors, update
current systems, and additional administrative work in order to implement the provisions of the
proposal. Therefore, Oversight will reflect a potential cost to various state agencies and local
political subdivisions that accept digital asset payments used as currency. For simplicity,
Oversight will only reflect this potential cost to the state in the General Revenue Fund.
Officials from the Office of Attorney General (AGO)
arising from this proposal can be absorbed with existing resources. The AGO may seek
additional appropriations if the proposal results in a significant increase in litigation or
investigation costs. L.R. No. 1102H.01I
Bill No. HB 1136
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Oversight does not have any information to the contrary. Therefore, Oversight assumes the
AGO will be able to perform any additional duties required by this proposal with current staff
and resources and will reflect no fiscal impact to the AGO for fiscal note purposes.
Officials from the Office of Administration - Administrative Hearing Commission,
Department of Commerce and Insurance, Department of Economic Development,
Department of Elementary and Secondary Education, Department of Higher Education
and Workforce Development, Department of Health and Senior Services, Department of
Mental Health, Department of Labor and Industrial Relations, Department of Public
Safety (Division of Alcohol and Tobacco Control, Capitol Police, Fire Safety, Office of the
Director, Missouri Gaming Commission, Missouri Veterans Commission, State Emergency
Management Agency), Department of Social Services, Office of the Governor, Missouri
Department of Conservation, Missouri Ethics Commission, Missouri Department of
Transportation, Missouri National Guard, MoDOT & Patrol Employees’ Retirement
System, Office of AdministrationOffice of the State Public DefenderOffice of the State
Treasurer, Office of the State Auditor, Missouri House of Representatives, Joint
Committee on Administrative Rules, Joint Committee on Education, Joint Committee on
Public Employee Retirement, Legislative Research, Oversight Division, Missouri Senate,
Missouri Lottery Commission, Missouri Consolidated Health Care Plan, Missouri State
Employee's Retirement System, and State Tax Commission
have no fiscal impact on their respective organizations. Oversight does not have any information
to the contrary. Therefore, Oversight will reflect a zero impact in the fiscal note for these
agencies.
Officials from the City of Kansas City and the Clay County Auditor’s Office each assume the
proposal will have no fiscal impact on their respective organizations. Oversight does not have
any information to the contrary. Therefore, Oversight will reflect a zero impact in the fiscal note
for these agencies.
Officials from the Department of Natural Resources and the Missouri Department of
Agriculture Office of the State Treasurer
this proposal.
Officials from the Missouri Highway PatrolDepartment of Revenue for the
potential fiscal impact of this proposal.
Officials from the Missouri Office of Prosecution Services and the Office of the State Courts
Administrator did not respond to Oversight’s request for fiscal impact for this proposal.
Rule Promulgation
Officials from the Joint Committee on Administrative Rules assume this proposal is not
anticipated to cause a fiscal impact beyond its current appropriation. L.R. No. 1102H.01I
Bill No. HB 1136
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Officials from the Office of the Secretary of State (SOS) note many bills considered by the
General Assembly include provisions allowing or requiring agencies to submit rules and
regulations to implement the act. The SOS is provided with core funding to handle a certain
amount of normal activity resulting from each year's legislative session. The fiscal impact for
this fiscal note to the SOS for Administrative Rules is less than $5,000. The SOS recognizes that
this is a small amount and does not expect that additional funding would be required to meet
these costs. However, the SOS also recognizes that many such bills may be passed by the
General Assembly in a given year and that collectively the costs may be in excess of what the
office can sustain with its core budget. Therefore, the SOS reserves the right to request funding
for the cost of supporting administrative rules requirements should the need arise based on a
review of the finally approved bills signed by the governor.
FISCAL IMPACT – State GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028GENERAL REVENUECosts – DOR §30.1030 Contract modifications($100,000)$0$0 Computer updates($114,000)$0$0Total Cost – DOR ($214,000)$0$0Costs – Various State Agencies –
administrative/vendor costs for
potential payments to be made in forms
of digital assets other than current legal
tender(Unknown)(Unknown)(Unknown)
Costs – §362.1125
Recovery of funds
$0 or
(Unknown)
$0 or
(Unknown)
$0 or
(Unknown)
Loss – exempt digital assets used as
payment method from capital gains tax(Unknown)(Unknown)(Unknown)
ESTIMATED NET EFFECT ON
GENERAL REVENUE
Could exceed
($214,000)(Unknown)(Unknown) L.R. No. 1102H.01I
Bill No. HB 1136
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FISCAL IMPACT – State GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028INMATE FUND (0540)Costs – DOC - §362.1125
Recovery of funds (Missouri
Incarceration Reimbursement Act)
(Unknown,
Could exceed
$250,000)
(Unknown,
Could exceed
$250,000)
(Unknown,
Could exceed
$250,000)
ESTIMATED NET EFFECT ON
INMATE FUND
(Unknown,
Could exceed
$250,000)
(Unknown,
Could exceed
$250,000)
(Unknown,
Could exceed
$250,000)
FISCAL IMPACT – Local GovernmentFY 2026
(10 Mo.)
FY 2027FY 2028LOCAL POLITICAL
SUBDIVISIONS
Costs - §362.1125
Recovery of funds
$0 or
(Unknown)
$0 or
(Unknown)
$0 or
(Unknown)
Costs – administrative/vendor costs for
potential payments to be made in forms
of digital assets other than current legal
tender(Unknown)(Unknown)(Unknown)
ESTIMATED NET EFFECT TO
LOCAL POLITICAL
SUBDIVISIONS(Unknown)(Unknown)(Unknown)
FISCAL IMPACT – Small Business
No direct fiscal impact to small businesses would be expected as a result of this proposal.
FISCAL DESCRIPTION
This bill creates the "Digital Assets Authorization Act".
The bill defines "blockchain", "blockchain protocol", "decentralized", "digital asset", "hardware
wallet", "node" and "self-hosted wallet". L.R. No. 1102H.01I
Bill No. HB 1136
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Under this bill, the state of Missouri or a municipality cannot prohibit an individual or person
from accepting digital assets as payment for goods and services; or to maintain self-custody of a
digital asset using a self-hosted wallet or hardware wallet.
The bill prohibits the state of Missouri or a municipality from imposing any additional tax,
withholding, assessment or charge based solely upon the use of a digital asset used as a payment
method to purchase goods or services.
The bill provides for the lawful operation of a node in Missouri for certain purposes relating to
blockchain protocols, as specified in the bill. In addition, the bill states that it does not override
or limit the applicability of certain laws identified in the bill.
This legislation is not federally mandated, would not duplicate any other program and would not
require additional capital improvements or rental space.
SOURCES OF INFORMATION
Attorney General’s Office
Office of Administration - Administrative Hearing Commission
Office of Administration - Budget and Planning
Department of Commerce and Insurance
Department of Economic Development
Department of Elementary and Secondary Education
Department of Higher Education and Workforce Development
Department of Health and Senior Services
Department of Mental Health
Department of Corrections
Department of Labor and Industrial Relations
Department of Revenue
Department of Public Safety
Division of Alcohol and Tobacco Control
Capitol Police
Fire Safety
Office of the Director
Missouri Gaming Commission
Missouri Highway Patrol
Missouri Veterans Commission
State Emergency Management Agency
Department of Social Services
Office of the Governor
Missouri Department of Agriculture
Missouri Department of Conservation
Missouri Ethics Commission
Missouri Department of Transportation L.R. No. 1102H.01I
Bill No. HB 1136
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Missouri National Guard
MoDOT & Patrol Employees’ Retirement System
Office of Administration
Office of the Secretary of State
Office of the State Public Defender
Office of the State Treasurer
Office of the State Auditor
Missouri House of Representatives
Joint Committee on Administrative Rules
Joint Committee on Education
Joint Committee on Public Employee Retirement
Legislative Research
Oversight Division
Missouri Senate
Missouri Lottery Commission
Missouri Consolidated Health Care Plan
Missouri State Employee's Retirement System
State Tax Commission
City of Kansas City
Clay County Auditor’s Office
Julie MorffJessica HarrisDirectorAssistant DirectorMarch 21, 2025March 21, 2025