Missouri Budget Finishes Short of Estimate for FY July 2, 2014

(AP) – Missouri may soon need to dip into its reserves in order to pay its bills.

Figures released Wednesday show that Missouri ended its 2014 fiscal year with a 1 percent decline in revenues compared with the previous year.

But the shortfall is larger when compared to the growth that had been projected. The roughly $8 billion in general revenues was $308 million short of what Gov. Jay Nixon’s administration projected and $241 million short of what the Legislature forecast.

That means the state has started its new fiscal year with less money in the bank than normal.

Nixon budget director Linda Luebbering says the state likely will have to dip into its reserves in July for cash-flow purposes.

Nixon Releases $215 Million in Budget Witholdings September 13, 2013

Notes:

(AP) — Missouri Gov. Jay Nixon on Thursday released $215 million for education and other state services that he had frozen while campaigning to sustain a veto of an income tax cut.

Nixon’s announcement came a day after the Legislature failed to get the two-thirds majority needed to override his veto of tax-cut legislation, which the governor contended would have punched a hole in the state budget. The released funds account for a little over half of the $400 million Nixon restricted when the state budget took effect July 1.

It includes $66 million in basic aid for K-12 schools and $34 million in core funding for higher education institutions, plus other specific allotments for education. The released money also will allow a pay increase to go forward for state employees and health care providers in Missouri’s Medicaid system.

Despite the demise of the tax cut, Nixon maintained a hold Thursday on $185 million of budgeted expenses, primarily for repairs and construction at state buildings.

He also froze a $1 million appropriation to help rebuild a burned-down vocational education school in northeast Missouri. Lawmakers enacted that expenditure Wednesday by overriding Nixon’s original line-item budget veto of it.

Nixon’s budget director, Linda Luebbering, said the governor temporarily restricted that vocational school expenditure in order to determine whether there is enough money in the particular fund to pay it, and whether the fund can legally be used for the building.

Republican lawmakers had criticized Nixon’s original spending restrictions as unjustified. On Thursday, they questioned his continued spending freeze, as well as his new roadblock to the $1 million school appropriation.

“He is a politically motivated governor who continues to use the children and students of this state as political pawns,” said House Speaker Tim Jones, R-Eureka.

State Rep. Todd Richardson, R-Poplar Bluff, said he will propose a constitutional amendment next year that would curtail the governor’s ability to withhold budgeted expenses when revenues are strong.

“I believe the Missouri Constitution is clear in limiting the governor’s withholding power to times of emergency or funding shortages, but he has continued to challenge that limitation to the point we now lack clarity on this important issue,” Richardson said in a written statement.

Missouri ended its 2012 fiscal year in June with 10 percent revenue growth over the prior year and a cash balance of nearly $450 million.

Missouri State Revenue Up 10%, But Not Enough to Thaw Frozen Funds July 4, 2013

(AP) – Missouri wrapped up its 2013 fiscal year with additional revenues, but that alone does not appear enough to thaw several hundred million dollars frozen in the current year’s budget.

On Wednesday, the state reported nearly $8.1 billion in general revenues during the 2013 fiscal year that ended Sunday. That was 10.1 percent higher compared with the 2012 budget year and greater than the 4.8 percent growth rate upon which the budget had been based.

Linda Luebbering, who is the budget director for Gov. Jay Nixon, said the cash balance is expected to be about $447 million. That is $339 million more than was expected but would be roughly half the balance in a normal year, she said.

Missouri’s individual income tax collections during 2013 increased 9 percent compared with 2012, while corporate income taxes were up 4.5 percent. Collections from sales taxes increased by 1.3 percent. Tax refunds declined 7.8 percent.

The budget news does not appear to affect the spending Nixon put on hold last week when he signed a nearly $25 billion operating budget for 2014. Nixon froze $400 million of spending for education, building repairs and state services because of concern that state legislators could override his veto of an income tax measure that he argues would drain state coffers.

Nixon vetoed the income tax cut approved by the Republican-led Legislature that would have phased in a tax deduction for business income over the next five years. It also would have gradually reduced the income tax rate for individuals and corporations over the next decade.

Luebbering said Wednesday the growth in Missouri’s revenues was considered before the budget action and that the income tax cut was the impetus.

“Until we have resolution on that, the restrictions will stay in place,” she said.

Missouri Senate Effort to Gut Driver’s License Bureau Budget Misses the Mark, Other Programs Cut Instead April 24, 2013

(AP) — Missouri senators trying to target budget cuts at the agency that issues driver’s licenses may have instead blocked funding for the registration of boats and mobile homes. And other Senate cuts could cancel funding for police training and the collection of child support, the state budget director said Tuesday.
A day after the Senate passed a budget plan packed with attention-grabbing cuts, an analysis of those cuts conducted by the state budget chief at the request of The Associated Press indicates that some reductions may have missed their intended mark while others could have unintended consequences.
The most prominent among the Senate’s cuts is the elimination of the entire $3.5 million allotment and 37 full-time employee positions for the Motor Vehicle and Driver Licensing Division. Republican senators said their intent was to hold some leverage over licensing officials as they seek additional information about the way the agency gathers, retains and distributes information about people who apply for driver’s licenses.
Senate Appropriations Committee Chairman Kurt Schaefer told colleagues during debate that, if the proposed cut ultimately became law, “they will not be able to issue any driver’s licenses.”
But Democratic Gov. Jay Nixon’s budget director, Linda Luebbering, said Tuesday that the cut would not actually hit the budget line that finances driver’s licenses. Instead, she said, it would prevent the processing of titles and registrations for boats, ATVs and manufactured homes. Luebbering said the cut also could prevent the state from issuing licenses to dealers and manufacturers of motor vehicles and boats.
She said funding for the issuance of driver’s licenses actually is located in a separate budget line labeled for “collecting highway related fees and taxes,” which the Senate left untouched at $22.9 million.
“That’s news to me, and that is not how they have ever explained the budget to us,” Schaefer, R-Columbia, said when told about the state budget director’s analysis.
In the coming weeks, Schaefer and a select group of senators will meet with a similar delegation of House members to negotiate a final version of Missouri’s 2014 budget. Schaefer said the confusion about the cuts highlights senators’ concerns that they have not been given specific information from executive branch officials about what actually is funded by particular budget allotments.
“It is incumbent on them to come in and explain to us what’s in these (budget) lines,” Schaefer said. He added later: “We not going to just blindly appropriate things without seeing clearly what’s in it.”

Mo. Budget Director Outlines the Upside to Medicaid Expansion December 24, 2012

(AP) — Although the federal government would spend billions of dollars, an expansion of Missouri’s Medicaid program could actually generate millions of dollars of new revenues and savings for the state’s budget, according to an analysis by Gov. Jay Nixon’s administration.
The Democratic governor plans to use the figures to bolster his argument to skeptical Republican legislators that the state should embrace a key part of President Barack Obama’s health care law and expend Medicaid eligibility to hundreds of thousands of lower-income adults.
The projections released this past week by Nixon’s budget office show Missouri could see a nearly $47 million increase in general revenues during the first year of the Medicaid expansion in 2014. That boost in state revenues would grow to nearly $140 million in 2016 before gradually declining to a slightly better than break-even point in 2021.
As called for under Obama’s health care law, the federal government would pay the full cost for the first three years of the Medicaid expansion before states gradually pick up a 10 percent share. The analysis concludes that Missouri stands to benefit because it would no longer have to spend state money for certain health care expenses, and because the flow of federal money to medical providers would generate higher state income and sales tax revenues.
“This, to us, points out that we do believe this is something that is affordable for the state of Missouri to do,” said Nixon’s budget director, Linda Luebbering.
To expand Medicaid, however, will require the consent of Missouri’s Republican-led Legislature, which has opposed almost anything associated with Obama’s health care law. Republican legislative leaders have cited concerns about long-term costs to the state of a Medicaid expansion, as well as the cost to an already indebted federal government. They also have raised philosophical objections to enlarging social programs.