Missouri state budget (2012-2013)

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On April 25, 2012, the Senate passed a $24 billion budget that did not cut services to the blind as the House budget did, and gave state employees earning up to $45,000 annually a raise.[1] The budget went to a conference committee, and the legislature presented it to the governor.[1][2]

The enacted bills comprising the state budget can be accessed here.

In August 2012, the state borrowed $100 million from the Budget Reserve Fund to put in the general fund and planned to repay it by mid-May 2013, before the end of the fiscal year.[3]

Missouri officials in December 2011 predicted a 3.9 increase in state revenue, giving the state approximately $7.6 billion for fiscal year 2013.[4] The budget was based on the assumption of 3.9 percent revenue growth.[5] The state faced a deficit of $500 million.[6] State Representative Tony Dugger said that the fiscal year 2013 budget discussions would include no plans for proposed tax increases or new taxes.[7]

Education

Education funding was based on the assumption that lottery proceeds would grow by $50 million in fiscal year 2013, or 18.5 percent. If that increase did not materialize, the resulting shortfall could necessitate cuts in K-12 education or other areas of the budget funded by general revenue.[5]

Legislative proposed budget

The conference committee made up of lawmakers from both chambers agreed on a budget on May 10, 2012, and sent the budget to the governor for his signature.[8][9] It spent $50 million less than the governor's proposed budget.[8] The budget spent $8 billion of general revenue, the most flexible area of the budget, and funding for public schools remained the same as fiscal year 2012.[9] Highlights of the budget included:[8]

  • A health care program for blind Missourians would receive most of its funding from the state budget;
  • Seven universities would split a $3 million boost to higher education funding;
  • Missouri's seven veterans homes would be funded primarily through the state's casino entrance fee; and
  • State workers who earned less than $70,000 annually would receive two percent raises in the coming year.

The House Budget Committee added $1 billion to the budget. The House budget plan allotted just 75 percent of the additional Medicaid money requested to cover an increased use of some Department of Mental Health services. It also allotted 75 percent of the amount needed to offset a decline in the federal matching rate for Missouri's Medicaid services in the departments of social services and health.[10]

The House approved the 13 appropriations bills that made up the state’s fiscal year 2013 operating budget on March 22, 2012.[11][12] The budget included $6 million for a scaled-down version of the health care program, with $4 million of that total coming from legislation that hadn't passed yet that ended a sales tax exemption for newspapers.[12] It eliminated a $28 million health care program that served about 2,800 blind people who did not qualify for Medicaid, and directed that money toward higher education to avoid cuts at the state's universities.[12]

The Senate Appropriations Committee agreed to keep the House’s proposals for higher education funding, which would keep spending stable relative to the then-current year's amount. Senators said they were also looking for a way to restore funding to the program for the blind, which the House had cut to fund higher education.[13]

The Senate also differed with Nixon and the House on an increase in pay for state employees, who had not seen a raise in four years. Nixon recommended all employees get an increase but delayed its effective start until January 1. The House approved a pay raise starting July 1 but would apply it only to those workers making less than $70,000. The Senate approved a plan that would also start on July 1 but only cover workers making less than $45,000.[13]

Governor's proposed budget

Gov. Jay Nixon presented his proposed fiscal year 2013 budget on January 17, 2012.

The budget cut $508 million, and those cuts included:

  • $191 million from Medicaid,
  • $89 million from higher education, and
  • 816 state jobs[14]

The proposed budget increased funding in some areas, including:

  • K-12 school funding by $5 million, but this still nearly $500 million less than what was called for by the state’s school funding formula, and
  • A two percent raise for state employees, starting January 1, 2013, at a cost of $23.6 million.[15]

The plan relied on $52 million in increased revenue from a tax amnesty plan that twice failed to clear the legislature in 2011.[15] Other sources of new revenue included:

  • Expanding a state license ban for professionals and businesses that hadn't paid state taxes;
  • Transferring money from a fund of the Missouri Health and Educational Facilities Authority; and
  • Increasing casino fees.

The governor's plan predicted that a total of $100 million in new revenue could be generated.[16]

The governor proposed finding money to plug a budget shortfall by asking universities to give the state money from their reserve funds. The governor's proposal called for the University of Missouri to chip in $63 million and four other schools to come up with lesser amounts, for a total of $107 million.[17] On January 5, 2012, the governor said that plan was now "off the table."[6] When the House cut a program for the blind to offset cuts to higher education, the governor proposed using $17.75 million in new federal money related to the Medicaid program to supplement blind health care.[13]

References

  1. 1.0 1.1 St. Louis Today, "Mo. Senate budget funds pay hikes, blind benefits," April 25, 2012
  2. KOMU.com, "Legislature Sends 2013 Budget to Gov. Nixon's Desk," May 10, 2012
  3. CBSNews.com, "Mo. taps reserve fund to help with cash flow," August 2, 2012
  4. Businessweek, "Mo. estimate predicts 3.9 percent revenue growth," December 21, 2011
  5. 5.0 5.1 The Missouri Budget Project, "Missouri FY 2013 Budget Relies on Risky Assumptions," June 1, 2012
  6. 6.0 6.1 The News-Leader, "Plan to tap universities' reserve funds is out," January 6, 2012
  7. The Marshfield Mail, "Missouri’s dbudget to be big legislative issue for 2012," December 22, 2011
  8. 8.0 8.1 8.2 St. Louis Today, "Missouri lawmakers reach budget agreement," May 10, 2012
  9. 9.0 9.1 The Columbia Tribune, "Lawmakers send budget bills to Nixon," May 10, 2012
  10. St. Louis Today, "Mo. lawmakers asserting more control over budget," March 18, 2012
  11. Missouri House of Representatives, "House Gives Initial Approval to FY 2013 State Operating Budget," March 20, 2012
  12. 12.0 12.1 12.2 The Kansas City Star, "Missouri House passes $24 billion budget," March 2, 2012
  13. 13.0 13.1 13.2 The Springfield News Leader, "Senators start work on budget, look for ways to avoid cutting health care funds for blind Missourians," April 5, 2012
  14. St. Louis Today, "Gov. Jay Nixon proposes budget cuts, boost to K-12 education," January 17, 2012
  15. 15.0 15.1 The Kansas City Star, "Nixon proposes $106 million cut from Missouri higher ed," January 17, 2012
  16. CBS St. Louis, "Analysis: Nixon’s Budget Depends On New Revenues," January 23, 2012
  17. St. Louis Today, "Nixon considers asking 5 Missouri universities to lend money to state," December 16, 2011