The Associated Press May 19, 2010, 11:04AM ET

Missouri governor plans $350M in cuts to budget

Missouri Gov. Jay Nixon is planning to cut about $350 million before approving the budget passed by state lawmakers.

Nixon budget director Linda Luebbering said Tuesday the additional budget cuts are necessary because of falling state revenue, uncertain cuts that were factored into the budget and lawmakers' refusal to approve other bills whose anticipated savings were booked into the spending plan that takes effect July 1. The proposed spending cut would amount to roughly 5 percent of the general revenue money over which the state has the most control.

Specific cuts will be announced when the governor signs the budget, which is expected to be in mid-June. Luebbering said the additional cuts are likely to come through trimming programs and eliminating state jobs.

"We were out of easy cuts a long time ago," Luebbering said.

Many lawmakers had acknowledged that the governor likely would need to make more cuts to the budget, but Republican House leaders have asserted their budget is balanced.

Budget Committee Chairman Allen Icet, R-Wildwood, told reporters immediately after lawmakers completed their annual legislative session Friday that he remained comfortable calling the budget balanced even though some of the proposed cost savings had not passed.

Lawmakers last month approved a $23.3 billion operating budget for the 2011 fiscal year. That includes about $456 million cut from the governor's original budget after Nixon said $500 million needed to be eliminated because of falling state revenue and uncertainty with federal stimulus money.

The Legislature spread its cuts across numerous state programs and cut roughly 1,000 government positions.

Within the budget, basic state funding for K-12 public school districts remains the same even though Missouri's school funding formula called for a more than $100 million increase, schools receive less state aid for busing and the Parents as Teachers early childhood program is cut by more than half. Colleges and universities get a 5 percent budget cut and less money is spent for twice-daily Amtrak passenger train service between St. Louis and Kansas City.

Senate Appropriations Committee Chairman Rob Mayer said lawmakers had shown leadership by cutting state spending.

"We protected Missouri taxpayers by passing a budget that funds government operations at a level taxpayers can afford -- without a tax increase," said Mayer, R-Dexter. "We accomplished this daunting task ahead of schedule, despite the fact that Gov. Nixon put off until March the reality that the budget he proposed in January was dramatically out of balance."

Nixon's planned budget cuts are designed to offset shortfalls of $89 million because of legislation that did not pass, $55 million because of uncertain savings that were included in the budget and $200 million because of declining revenue.

Lawmakers booked $125 million in budget savings but only passed the legislation necessary to realize $36 million of that. The proposals that did not pass include requiring Medicaid managed care companies to pay an insurance premium tax from which they currently are exempt, requiring future state workers to pay into their pension system and retire later and eliminating state holidays for the birthdays of Harry Truman and Abraham Lincoln.

The Legislature's budget also includes about $55 million in savings that Nixon's budget office does not believe can be counted on yet. Those savings include using funding sources that are not permitted and dropping the anticipated growth in the number of people enrolled in Medicaid.

In addition, state revenues have continued to decline. For example, figures released earlier this month show that Missouri's net general revenue was 3.6 percent less in April compared to the same month last year. And for the first 10 months of the current budget year, revenues were down more than 11 percent.


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